I’m throwing down the gauntlet and entering the trading ring. Ladies and gentlemen I would like to introduce the ultimate trader champion of the world…it is SHE.
Yes you read it correctly, move over guys because I’m going to explain why women make better traders than men.
1. The Biggest Fish
Men like to show off and often measure their worth against how others are doing. The prized fish caught on a men’s fishing trip is a perfect analogy. He wants a picture with the biggest fish he caught to display proudly on his desk to recant to his buddies about his big catch. Whether he is talking about who caught the biggest fish, who made the most money, or how many computer screens they use to trade, a man’s ego gets in the way of his potential. Almost daily I hear or read about male traders biggest or best trades on twitter, websites or blogs. Men seem to validate themselves as traders by posting his one big trade in the same way that men talk about the biggest fish they caught.
Sure a little competition can help motivate anyone male or female, but men are less likely to be able to keep this competitive nature in check. When he becomes more focused on trading better than the next guy, he isn’t focusing his energy on taking profits from the market.
2. Feeding His Ego
A man’s ego can also seriously hurt his trading account. While men may have one big trade, they may have many other big losing trades that they don’t publicise, these losses can deplete his account. Big winning trades are great, but big losing days hurt and can deplete your account quickly. Trading with consistent profits will create a sustainable life in trading.
Women in my opinion are less likely to focus on winning big with one trade. She is able to keep her ego in check and make profitable trades consistently according to her trading plan. She isn’t worried about making more money than the next guy; she remains focused on her own profits, plan and trading accounts. She knows she can make money and she keeps her energy focused where it counts.
3. She Listens
As traders, we all need to realise that the market doesn’t listen to individual traders. Successful traders understand how to be patient instead of trying to bully the market to move in their favour. Anyone can learn set ups and market analysis, but waiting for them to set up requires the ability to patiently listen to the markets. Luckily for me, women are more patient and far better listeners than men. She is much more likely to wait and watch for the markets to set up according to the rules of her trading plan.
Listening to the market will keep her from getting in a trade too early. Sorry guys, but no matter how loud you yell at the computer screen when the markets move against you, the markets won’t hear you telling it to move in your favour. Come on guys, admit it, you know you’ve yelled at the screen when you got in a bad trade.
4. Getting Help When You Get Lost
To support this theory I need only remind you of what happens when a man and a woman get lost while driving to a new destination. Typically, a woman will stop and ask for directions while a man will continue driving in circles hoping to figure out where to go on his own. She realises that asking for help is not a sign of weakness.
These behavioural differences also translate in to how a woman and man react when they get lost trading (metaphorically speaking). If she gets in to a losing streak, she is more likely to ask for help from a trusted trader to refine her trading plan. A man will try and figure it out on his own which can lead to even bigger loses or worse “hope and pray” trades.
Managing losing trades is what keeps traders trading long term. Successful traders realise that not every trade is going to work but they know how to manage a loss responsibly. In my opinion, women are more likely to ask questions and get help when they need it. As she refines her trading strategy she sets herself up to be a successful trader for the long term.
5. I’m Not Alone
You need only Google using these keywords “why women make better traders” to find many other experts and large financial publishers writing about the same thing. I am not alone.
So, I would like to propose a toast, please join me in raising a glass to women in the markets. Congratulations ladies, you can indeed trade, and in fact, you are the better trader.