11/23/2025 - How does expertise develop?  We begin as students and then we become apprentices to successful performers. That is how medical students grow into interns and then grow into becoming residents and attending physicians. It is how a freshman football player practices with the starters, helps them scrimmage, and eventually gets into games and becomes a starter. It is how a beginning actress becomes a small role-player in a production, becomes a backup to the star, and eventually gets larger roles herself. 

We develop expertise by developing professional roles. Through that development, we gain the experience of training, but we also gain the expertise of being a true performer.  In the hedge fund world, a junior person begins as an analyst, sees how ideas are traded, grows into managing a "sleeve" of capital themselves, and eventually grows into becoming an associate portfolio manager and a full PM with their own team.

We grow through professional roles and from the feedback we get from our experience and from our mentors.

No one develops expertise in isolation.  In any performance field.

Much of the frustration encountered in trading has nothing to do with lack of control over emotions, lack of discipline, etc.  It is a function of a lack of training and mentoring--and a lack of opportunity to internalize the new roles and experiences of expertise. Trying to improve your psychology while trading in isolation is like trying to improve your game as a basketball player without being part of a team.

The most promising thing a developing trader can do is form a pod with other developing traders and learn from each other and with each other.   

11/21/2025 - The greatest part of our psychological growth occurs through social roles.  When we take on a role with others, we inevitably receive feedback about who we are and how we perform and we internalize that feedback.  When we take on many social roles, we absorb a wide range of such feedback and develop a broad sense of who we are and what we do well.  A child takes on roles with parents, siblings, and peers and then broadens their sense of self through roles at school, in extracurricular activities, in social groups, etc.  What is important in this process is that we internalize our sense of self through relationship experiences.  Everyone we interact with is a mirror, showing us something of ourselves.  In our work, our family lives, our social and community lives, we experience many mirrors and build a diversified sense of who we are.

If you understand this social role perspective, you can appreciate why solo trading is psychologically dangerous.  Trading is a challenging activity, and it can be an enjoyable application of our skills and talents.  But undertaken in isolation, it is a limited experience.  We operate in a relative vacuum.  We do not encounter fresh mirrors that stimulate new experiences of ourselves.  Over time, we become stale.  We do not grow as people.  Sometimes we attempt to fill that void by trading more and more, hoping that profits will provide us with the fulfillment and inner satisfaction that we lack.  We know how that ends up.

A major benefit of trading in a team is the opportunity to take on fresh roles as part of the trading process.  We mentor others, we share ideas, we enjoy the company of our mates.  At the firms where I work, an important part of the enjoyment and fulfillment traders experience in their work is in what they learn from others, what they give to others, and the roles they play within the team.  When there is fulfillment in those roles, there is no need to put all of one's self-esteem eggs in the trading basket and overtrade.  A rich personal life outside of markets and a broad range of roles within one's trading experience create psychological wealth--and that is what can help create trading wealth.  

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