I hope from reading this book you have learned something about your own personality, both as it pertains to trading the markets and to life in general. Keep in mind that there is no such thing as an “ideal trading personality” that will ensure consistently successful trading. From our personal experience as well as our accumulation of research data on the personalities of some of the world’s top traders, we have found that traders with very different personality profiles can certainly succeed, although they generally do share some common traits.
We have uncovered in our studies that although the universe of successful traders is not entirely homogenous, there are some temperamental traits (such as being low in N1 and N6, high in O4 in comparison to E5) which tend to show up more in populations of successful traders in comparison to populations of general market traders. These particular trait patterns seem to be quite beneficial to trading the markets. It is also true that someone who is conversely very high in N, high in E5, very low in C, and very low in O4 is probably going to really struggle at making a career out of trading the markets. Such a person is prone to impulsively making large and frequent trades, even gambles, and experiences reactive negative emotions, which in turn may interfere with the cognitive tasks needed to execute trading properly.
I hope you have seen and learned that “controlling” or “dampening” your emotions” is not the goal of the wise trader. The better approach is regulating your emotions. Someone who is very high on the N scale or E scale needs to appreciate that he or she feels emotions strongly and quickly and needs to proactively find ways to compensate for this. But no matter what your scores on the N and E scales, we all have lots of emotions while trading. It is important to recognize that emotions can be both a curse (i.e., they can get in the way of logical thinking) or a blessing (if people can learn to focus and translate some of their emotions into a healthy, competitive drive and determination to succeed).
Meanwhile, traders who are too emotionally stable—low in N—might be able to clearly and rationally use their cerebral cortex without emotional interference, but at the same time they may lack the ability to easily tap into emotions at the appropriate times to spur themselves on (develop a true passion), have an appropriate level of fear or apprehension, and so on. They may be less aware of an oncoming danger or excessive risk because they simply don’t have a loud enough emotional fire alarm.
Ultimately your unique personality, which is brought into clearer view using the NEO-AC, is what you have to work with. It is who you are. Personality is what makes someone “someone.” It is very difficult to fundamentally change who you are as a person to any significant degree. As an adult your personality is not likely going to change much. If you take the NEO-AC again in 10 or even 20 years, your results will not vary much (unless, of course, you develop Alzheimer’s dementia, have a major trauma to the brain, and so forth). Consequently, the key is to fully appreciate the complex melding together of the five factors and thirty facets on the NEO-AC, understand where your personal strengths and weaknesses are, and then learn how to adapt to them through various strategies and techniques.
Do not think of being emotionally stable (low in neuroticism) as being necessarily “better” than being unstable (or neurotic). The key is how far away from average you are and whether or not you can positively adapt to the variations in the excessive trait that you possess. Although our research indicates that low anxiety is a common trait among great traders, this may not be a universal truth, and in fact two of the traders we studied indeed are not low on the anxiety scale. These outlier anxiety-prone successful traders have learned—either through personal experience and/or through coaching—how to regulate the emotions that pop up during their trading day.
This same principle, learning to adapt, applies to all of the personality traits. Successful traders are people who are able to bring their personal strengths to bear, meanwhile controlling and mitigating the effects of their personal weaknesses. They align their strengths with the style and method of trading that best suits them, such as using systems versus discretionary trading. They find the right fit between who they are as a person, their overall trading approach or philosophy, and their specific trading methods and plans.
I wish you boundless happiness and personal fulfillment as you travel down the road of knowing yourself better and applying this knowledge to market trading and to other domains in your life as well!