It may seem like we know ourselves because physically we are ourselves, but do you truly KNOW yourself? This past week I took a personality test, the Myers Briggs to be specific. If you have never taken a personality test such as the Myers Briggs, I would highly recommend it (here is a link to one – http://www.humanmetrics.com/cgi-win/JTypes2.asp). Being able to discover what type of personality you ‘have’ can be freeing and containing (if you let it be so). Freeing in the sense of you finally understand who you are through the explanation of words that you had yet to put together before. Unfortunately containing in the sense that once you old by a test who you are, you could easily begin to suffer from the self-fulling prophecy and therefore the will power to change would deteriorate.
My Personality Type Results
The test described me as an INTJ. What that means is I was categorized by Introvert (67%), Intuitive (50%), Thinking (100%) and Judgment (67%). The percentages can be simply thought of as to what degree I am this type of traits. higher the number the stronger the trait.
A summary of the INTJ personality type follows, work from (http://www.myersbriggs.org/my-mbti-personality-type/mbti-basics/the-16-mbti-types.asp)
“Have original minds and great drive for implementing their ideas and achieving their goals. Quickly see patterns in external events and develop long-range explanatory perspectives. When committed, organize a job and carry it through. Skeptical and independent, have high standards of competence and performance – for themselves and others.”
Introvert – This trait according to many of the websites I have read regarding this trait naturally explain that as an introvert I enjoy time alone. An Introvert’s work is best when done alone with only his/her thoughts. This is an accurate representation of myself as I have often found myself to enjoy being alone to work through thoughts and problems. My level of comfortably and productivity is higher when it is simply me and my thoughts. For example, when I need to truly get something done (project, homework, post, trades, etc), I will sit down at my desk, turn on CCR and have a cup of black coffee. I do not need/want anyone to interrupt me during this time as I am ‘in the zone’ or fully absorbed in what I am doing.
iNtuitive – more abstract thoughts than concrete, will venture outside the box as well as focus on future plans versus immediate present. This definitely describes myself. As I have grown older I have become more interested in the abstract philosophical and psychology ideas. I also have always been a ‘planner’, I am one to plan ahead and look towards the future with a set of goals with steps to get there.
Thinking – INTJ’s think with logic and with an objective mindset. It takes a lot of evidence for someone to alter an INTJ’s beliefs, but once proven an INTJ will likely happily move beliefs. An example of this pertaining to myself is I always have a schedule and a routine, I thrive on consistency. It is logical and efficient to have a distinct and consistent routine in which you can rely upon. On a side not, if you do not have a consistent schedule or routine, I would recommend one. It commonly decreases stress and worry because you know what, when, how, where you should be doing.
Judgement – Feel more powerful when schedules are predictable and rule are created by and for the individual, as well make their plans earlier. As we have already discussed, this describes myself very well and it is definitely true. I know exactly where I will be every day down to about the minute (with a 3-4 minute deviation).
A few more side notes related to INTJ, I have read than because of the “NT” trait, I am likely to be always trying to improve myself. This is certainly true. I work with the market, I always have room to improve. I am also always thinking about ways in which my thinking and being can improve from a psychological perspective. Unfortunately, INTJs are also not always the most considerate people due to their logical and therefore honest mindset. Sometimes they can come off as uncaring, this is true for myself as well. I have found myself in positions in which I wonder what I am doing, why did I just say that – why that blunt? All personalities have pitfalls and this is just one of the many than INTJs (me) suffer from.
How Personality Types Relate to The Stock Market
Now at this point, let’s analyze what makes the best market participant. I am retrieving the following information from this document – http://www.iitm.com/articles/personality-type-and-trading.htm
To become a good (or to use more appropriate semantics, successful trader) one must know themselves well enough to be able to constantly and consistently grow in not only trading but in themselves. This unfortunately sounds extremely abstract and vague to many new traders but as one progresses in their trading, it becomes increasingly apparent that this is a necessary task to accomplish. One way to do this is simply to know one’s personality type, each has it’s benefits and limitations. We already analyzed mine, take a second to analyze yours before we move on to discuss the various benefits to each in relation to the stock market.
Introversion or Extroversion –
Through the sample in this study it was found that trading success has little correlation to either introversion or extroversion. This makes sense to me because neither really relate back to the trading mentality. It does not matter which way one gets his/her energy. Also, the study made it clear that being an introvert does not mean that one is not sociable or likeable, they simply get their energy from inside versus others (extrovert).
Sensation or Intuition –
25% of the population is intuition dominant however 61% of the sample of traders in the study were intuition dominant. The study described people that were intuition dominant to be more aware of the bigger picture. There was a strong correlation to strong trading records and having intuition as a dominant trait.
Thinking or Feeling –
Thinking, as described in the study was the a logical thought process involving the cause and effect of taking an action. Most of the traders in the sample population were thinking dominant however there was an interesting phenomenon that also needs to be considered. Through the study they found that that most were thinking dominant however the most successful ones were ones that showed equal thinking and feeling. The study explained this by saying trading requires thinking to come up with a trading plan but feeling is required in executing the trade most likely due to the fact that market is ever changing and extremely dynamic.
Judgment or Perception –
A judger tends to be more likely to fall into the unfortunate trap in which they believe work, work, work and no play versus a perceiver. When trading the markets one must have a strong will power to continue to work harder to improve a strategy or a trade. The study confirmed this belief, 72% of the sample traders were judgement dominant, only 28% were perceiving dominant.
The final part of the study goes into different combinations of traits and which would likely find most success in the markets. Having the combination of “NT” was determined to have the best qualities of success. the following is what the study said about people with the “NT” trait –
The Promethean Temperament: The Promethean Temperament comes into being when the qualities of intuition (N) and thinking (T) are dominant. The NT temperament (INTP, ENTP, INTJ, ENTJ) is only found on average in about 2% of the population. As a result, NT people must grow up in an environment full of people who are usually quite different from them. For example, about one family in 16 would have both parents as Ns and only one in a thousand would have both parents as NTs.
The NT personality is looking for power over nature: to be able to predict, control and explain realities. Thus, the NT trader would be one who wants to predict, control and explain the markets, much of which is the antithesis of good trading. However, since his ultimate goal is to be a good/great trader, the issue is simply how to get there. He has a strong drive to continually improve (as opposed to the SPs drive to simply act). As a result, I would generally expect this group to produce more good traders than any other. Our data suggests this to be the case! First, we have a lot of data on the NT personality types. Although they only constitute about 2% of the population, NTs constitute 45.2% of our sample population—a truly amazing statistic. Among our NT traders, about 10% show outstanding trading records—a higher percentage than any of the other temperaments.
The NT is very self-critical. He badgers himself about his own errors. He taxes himself with the resolve to improve. If his pushing is used as a learning process, then he is bound to improve. However, the NT can easily get caught up in the perfectionist trap, which can prevent him from getting anywhere. For example, if the NT’s self-criticism is tied into his/her self esteem, then he can become frozen into inaction or into repeating the same task because he is not satisfied with the results. However, I have found that NTs show tremendous improvement when they go through my private consultation program.
The NT is likely to know that recreation is important to his health and overall well-being. However, his play has little spontaneity or fun. Instead, NT play is an exercise in conquest and being the best. He does not allow himself to make any mistakes, logical errors, and yet, paradoxically, requires that he have fun because that’s what people are supposed to do when they’re playing.
The trader who is an NT will live his work. If markets stay open 24 hours, he is likely to try to follow the market for 24-hours just because the market exists and missing something might be making a mistake. He wants to be the best possible trader, so he will do whatever he can to be successful. He is extremely vulnerable to the “all work, no play” syndrome and this kind of attitude can lead to a very out-of -balance lifestyle.
The NT wants to be the scientific trader. They are drawn to occupations that have a logical understanding, in which they can master some new concept about trading or design some great new trading system. He has an inquiring attitude and deals with others in a straightforward, albeit cold, approach.
The NT generally focuses on the future, trying to figure out what might happen next. And once he masters a challenge, he is very likely to move on to another one. Why? Because his goal is competency in every field. Thus, his goal might be to achieve greatness in trading, but as soon as he receives it or thinks he has it, he is likely to move on to something else.”
I would highly recommend researching this topic more on your own. There is an extraordinary amount of information out there regarding personality types and the strengths and weaknesses behind them. Through studying yourself, you are likely to become a better trader, but if not that, at least a better person as you will be able to relate to others who are different than you. Please let me know if you happen to have any questions or comments regarding the study of personality traits, trading, etc. I find these topics extremely fascinating and would like to learn more about them. You may reach me on here (Contact page), on Twitter (@BenCBanks), or on StockTwits (@BenCBanks).