Info!! X Things Your Trading Rail Tape Says Close You

Having spent a publish of years inwards recruitment roles at trading firms, I'm accustomed to seeing trading rail records.  Influenza A virus subtype H5N1 rail tape is a chip similar a college applicant's SAT score:  it doesn't guarantee yous admission, but it gets yous inwards the door for a look.  Skilled recruiters tin flame read quite a chip from a trader's rail record.  Here are 10 of the most of import things your rail tape says nearly yous in addition to your trading:

1)  How honest are you? - You'd survive surprised past times the publish of rail records that are inaccurate.  There are ways a proficient recruiter tin flame position this, but every bit nosotros saw alongside the Madoff scandal, what looks also proficient to survive truthful normally is.  Overfit organisation results are unopen to other illustration of dubious rail records.  Influenza A virus subtype H5N1 valid rail tape is independently verifiable.  One candidate I heard of produced a seemingly stellar rail tape alongside multiple years of solid earnings.  When the due diligence procedure called for several years of IRS returns to verify income, the candidate mysteriously dropped out.  We tin flame trust inwards the Lord, but all others should stimulate got verifiable rail records. 

2)  How correlated are you? - Are yous basically next full general marketplace returns, or are yous adding alpha alongside something unique inwards your trading process?  Low correlations oft speak to the inventiveness of a trader's see generation.

3)  How much arrive at yous brand on a risk-adjusted basis? - If yous are correlated to the full general market, in addition to hence yous desire to present that yous are making to a greater extent than per unit of measurement of conduct chances taken than the full general marketplace affords.  Influenza A virus subtype H5N1 high Sharpe ratio suggests that yous non entirely brand money, but arrive at hence consistently, alongside solid conduct chances management.

4)  How good arrive at yous perform across marketplace conditions? - Influenza A virus subtype H5N1 proficient rail tape is long plenty to demonstrate your functioning inwards volatile in addition to non-volatile markets; during uptrends, downtrends, in addition to ranges; in addition to during unlike marketplace regimes.  Are yous a one-trick pony, making coin entirely inwards ane form of market, or tin flame yous survive profitable across a diversity of marketplace conditions?

5)  How much arrive at yous describe down? - This is purpose of performing on a solid risk-adjusted basis, but captures to a greater extent than specifically how yous avoid blowups.  Influenza A virus subtype H5N1 proficient rail tape should demonstrate that yous play proficient defense strength every bit good every bit offense.

6)  Where arrive at your returns come upward from? - Do yous brand your coin predominantly from ane marketplace in addition to ane form of trading, or arrive at yous employ multiple strategies across multiple trading instruments?  Do yous profits come upward to a greater extent than from shorter-term trading or longer-term holds?  Do yous brand to a greater extent than coin inwards forenoon trading if you're a daytrader, or inwards the afternoon?

7)  How good arrive at yous merchandise size? - Are your largest trades your most profitable ones, or arrive at yous tend to lose coin when you're to a greater extent than aggressive?  Does conviction inwards an see Pb yous to merchandise it well, or does it beget overconfidence in addition to miserable conduct chances control?

8)  Is your functioning getting amend or worse over time? - Performance ever rises in addition to falls, but if yous encounter steady improvement, that suggests a positive learning curve.  Influenza A virus subtype H5N1 steady refuse from a successful trader tin flame survive a sign that a trading strategy that worked good at ane marketplace catamenia no longer is yielding positive expected returns.

9)  Are at that topographic point patterns to your performance? - Look at periods where yous stimulate got undergone personal stresses every bit good every bit positive periods inwards your life.  Do these stand upward for to trading performance?  Do yous tend to merchandise good afterwards a catamenia of apartment functioning or drawdown, or arrive at the losses tend to snowball?  After winning periods, arrive at yous tend to agree onto your winnings or hand them back?  Trading patterns tin flame survive peachy ways to position psychological patterns?

10)  If someone else had your rail record, would yous hand them your coin to invest? - That's where the safe hits the road.  If yous wouldn't invest inwards someone else alongside your rail record, perchance yous should non survive overconfident inwards allocating your working capital missive of the alphabet to your ain trading.  Viewing your functioning objectively is a peachy means to create upward one's heed how much conduct chances yous should stimulate got inwards your trading.

Further Reading:  The Challenge of Hiring Successful Traders
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