In honor of Jim Simons,
Here are 11 lessons from the greatest trader of our time:
(quotes by @GoshawkTrades on Twitter)
1. To be great, you need to be obsessed.
"What Jimmy liked to do more than anything else was think, often about mathematics. At the age of three, Jimmy doubled numbers and divided them in half, figuring out all the powers of 2 up to 1,024 before becoming bored."
2. Failure is inevitable in our line of work. It is a crucial part of the process.
“If you trade a lot, you only need to be right 51 percent of the time,” Berlekamp argued to a colleague. “We need a smaller edge on each trade.”
3. Short-term trading is more about game theory than prices.
“What you’re really modeling is human behavior, Humans are most predictable in times of high stress — they act instinctively and panic. Our entire premise was that human actors will react the way humans did in the past”
4. Alpha can come from anywhere.
"More adventurous investors may even use it to prepare for a potential crisis if, say, they see a series of unusual pizza deliveries at the Pentagon in the midst of an international incident."
5. Never be the smartest in the room.
“Work with the smartest people you can, hopefully smarter than you … be persistent, don’t give up easily.”
Goshawk Trades
6. Surviving long enough is one of the keys to long-term success.
“Persistence and discipline are key traits for long-term success in any field”
7. Don't aim for perfection, it is often a compromise.
“Everything is, to some extent, a compromise. Not everything can be perfect”
8. Utilize data to substantiate your choices, not just your instincts.
“The best decisions are often made with data and evidence, not just gut feelings”
9. Funnel energy into what you can control, for the quickest progress.
“The key is to focus on things that are under your control and make a difference. Don’t get distracted by the things you can’t change”
10. What Jim Simons looked for.
"I want a guy who knows enough math so that he can use those tools effectively but has a curiosity about how things work and enough imagination and tenacity to dope it out."
11. Luck plays a role in your journey, but you can increase your luck.
“Luck plays a role in success, but the harder you work and the more you prepare, the luckier you get”
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