Nature Vs. Nurture

Brandon Wendell
Instructor, CMT

While I was trading the other day, I had the television turned on to a financial channel. As I wasn’t getting much information or entertainment from the talking heads, I changed the channel. One of my old favorite movies was on TV, “Trading Places.” For those of you who may not be familiar with the film, it stars Dan Aykroyd and Eddie Murphy. Aykroyd plays Louis, an accomplished manager of a commodities brokerage in Philadelphia. Murphy plays Billy Ray, a streetwise hustler. The brothers who own the brokerage, Randolph and Mortimer Duke make a bet on whether a successful trader like Louis could survive if he had lost his job and home. They also speculate on whether Billy Ray could succeed in business if given the opportunity handed to him.

The argument between the brothers is whether environment, nurture, is the critical element to success or if success in the markets is something someone is born with, nature. Randolph Duke is convinced that the unfortunate Billy Ray is just a product of bad environment and bets his brother Mortimer that if given the chance, Billy Ray could be as sensational if not more than Louis. Mortimer believes that Louis’ success is a result of his “good stock,” and that he could thrive even if his job, money, and home were taken away.

The interesting thing is that at the same time the movie was released, there was an actual experiment taking place. Richard Denis was a well known commodities trader who reportedly turned $5000 USD into a fortune worth over $100 million. He along with a friend, William Eckhardt, placed an ad in the Wall Street Journal for people who were interested in learning how to trade. They selected 14 people who were taught a specific method for trading trends in the markets. The group became known as the turtle traders since Dennis visited a turtle farm in Singapore and stated they were raising traders just as they raised turtles. There are varying reports as to how successful the turtles were, but all agree that Dennis was able to take a group of novices and turn them into accomplished traders.

The movie and the real life experiment should be a great encouragement to anyone who is interested in entering the field of trading. It doesn’t take experience in a brokerage firm or even a finance degree to be able to become a successful trader. If anything, this may even be a detriment. All too often, people with trading experience prior to attending one of our courses will hold onto or revert to their old techniques that were unsuccessful. As a trading instructor, I have seen people from all backgrounds learn how to make consistent profits from speculating in the markets. Those who are successful share a willingness to learn and an open mind to implement Online Trading Academy’s core strategies into their own trading.

The Turtle Experiment also proved another point. The traders were taught a core strategy and were not allowed to deviate from that strategy. The combination of a proven strategy and discipline to follow it is the key to becoming a consistently successful trader. At Online Trading Academy, we teach our proven strategies that have been working for institutional and retail traders for many years and in many market environments. Through the Extended Learning Track, we also build discipline for students to follow those plans.

This newsletter is written for educational purposes only. By no means do any of its contents recommend, advocate or urge the buying, selling or holding of any financial instrument whatsoever. Trading and Investing involves high levels of risk. The author expresses personal opinions and will not assume any responsibility whatsoever for the actions of the reader. The author may or may not have positions in Financial Instruments discussed in this newsletter. Future results can be dramatically different from the opinions expressed herein. Past performance does not guarantee future results. Reprints allowed for private reading only, for all else, please obtain permission.