Just a few moments ago, I hung up the phone after speaking with a client who heads a trading desk at a bank everyone in the world has heard of. It would be easy to think – “well, that guy has it made”. (Government’s intention to break-up banks and stop prop-trading notwithstanding). Yet, he wants to be a better trader.

When he first called last summer he described himself as “always fighting the trend”. Now clearly that isn’t literal in that he got himself promoted in a bank, ran a hedge fund and re-hired to run a major desk. If he literally always fought the trend, he wouldn’t be profitable and therefore of course not in this position.

What he meant was – ‘Yes, I’m making it, doing well. BUT (!) I COULD BE doing so much better if I didn’t always have to try to find the end of a trend early!!’

Now I have been doing this long enough to know that /that/ particular proclivity almost always has its roots in feelings around being or proving oneself smart. Sure, there can be a little “oh I missed the move and now this is the only thing to do” but a pattern of fighting trends reveals some unconscious context of feelings around being smart.

As it turns out, he made progress on how this original stated problem played out. He didn’t fight the trend in January. He is not going into February in a hole from being on the wrong side. In short, becoming conscious of this background context around feelings about his own intelligence, knowledge and skill prevented him from making the same mistake.

But then came the next feeling.

He didn’t sell into January’s uptrend but also he couldn’t quite bring himself to get long. He did well at the beginning of the month but as the uptrend wore on he just couldn’t quite bring himself to jump in.

And a then a third layer of feelings arose – ANGER. He realized he was mad at himself for not being able to do what he knew the right thing to do was.

…which brings me to the title. Even the world’s top traders have patterns of behavior driven by their psychological contexts. The constellation of feelings that is our subjective experience and what if you think about it, is the hallmark of consciousness itself – is present in everyone who plays the market game. It’s easy to think that top guys have no feelings or a set of different feelings but that just isn’t true.

The gaps between the very best, the very good, the average and the amateur are there – they just aren’t as big as they seem from the outside. As demonstrated by this trader, filling those gaps – overcoming one less-than-profitable pattern – lies in feeling and identifying the feelings driving the behavior.

Conversely, the solutions do not lie in telling yourself one more time you are or are not going to do something. If that intellectual-discipline approach worked, the success rate among amateurs would go up, the brokers commissions would go down and an accomplished professional would be beyond all that. Strangely however I’ve had calls from two more household name banks just since the first of the year.

…that’s why to me, it is a question of the “human trading condition” – not one of smarts, intellect, discipline and probabilities. After all, this guy is a trained engineer and he happens to be able to do delta, gamma, theta and vega backwards and forwards.