How a Professional Trader Thinks | FTMO

Summary

In the 'ftmo Performance Talks' podcast, host Michael interviews Yan from Quant Lab, a trader with a background in semi-professional poker. They discuss the parallels between poker and trading, emphasizing the importance of risk management and psychological aspects. Yan shares insights on overcoming overconfidence and the value of patience in trading. The conversation also touches on the benefits of trading reviews, the role of a trading community, and the significance of having a trading routine and strategy. Yan advises new traders to focus on the process, develop a solid strategy, and manage emotions to increase their chances of success in trading.

Takeaways

• 😀 Every trader has unique weaknesses, and it's beneficial to have someone more experienced to help improve.
• 🃏 There are parallels between poker and trading, including risk management and psychological aspects.
• 📉 Overtrading is a common issue among day traders, and patience can be a significant advantage.
• 🤔 Emotions play a substantial role in both poker and trading, and managing them is crucial for success.
• 🚫 Avoid putting all your capital into one trade or tournament to prevent high emotional swings.
• 🧠 Self-analysis and recognizing overconfidence or 'winning tilt' are important for maintaining rational decision-making.
• 🔄 Taking time off during a losing streak can help regain mental energy and objectivity.
• 🤝 Discussing trades with peers or mentors can provide unbiased perspectives and improve trading strategies.
• 📈 Patience is a key skill for traders, and having routines before trading can help cultivate it.
• 📊 Focusing on the process of trading and developing a solid strategy is more important than expecting immediate profits.

Q & A

What is the main theme of the podcast episode?

The main theme of the podcast episode is trading performance for serious traders, with a focus on the importance of having someone more experienced to help elevate one's trading game.

What does the guest, Yan from Quant Lan, believe is a common weakness among traders?

Yan believes that a common weakness among traders is overtrading and lacking patience.

How does Yan draw parallels between poker and trading?

Yan sees similarities between poker and trading in that both involve incomplete information, risk management, and psychological aspects. Both require self-analysis and development outside the actual game.

What differences does Yan highlight between poker and trading?

In poker, there are solvers that provide optimal play frequencies and odds, whereas trading is more complicated and often lacks clear guidance on what should have been done in a particular situation.

How does Yan manage emotional aspects during trading, especially during a losing streak?

Yan suggests not trading more or larger during a losing streak as it's common to be in a non-rational mindset. Instead, seeking an unbiased perspective or taking time off to regain mental energy can be beneficial.

What advice does Yan give for dealing with overconfidence in trading?

Yan advises recognizing overconfidence, especially after successful trades, and taking a step back to calm down and not let emotions cloud decision-making.

How does Yan approach discussing trades with colleagues at Quant Lan?

At Quant Lan, they have weekly and quarterly trading reviews where a group discusses trades and strategies, which helps provide an unbiased perspective and improve trading skills.

What is Yan's focus for self-improvement in trading psychology?

Yan's focus for self-improvement is on patience, which he believes is an ultimate skill for a trader and can be a significant edge in the market.

What routine or methodology does Yan use to increase his patience in trading?

Yan has personal routines before trading and a mental check process to ensure he is taking trades in alignment with his plans and not just reacting to short-term market movements.

How many trades does Yan typically make per week, and what are his average holding periods?

Yan makes around 10 trades per week with an average holding period of multiple days to weeks.

What is Yan's approach to choosing which instruments to trade?

Yan trades mostly stocks and related ETFs, and while he doesn't have a favorite instrument, he believes it's important to have a bias towards an asset class and have the chart agree with that bias.