In my previous books on the psychology of trading, I emphasized the importance of going beyond self-limiting notions, developing and committing to public goals, taking risk, centering, and turning breakdowns into breakthroughs. In this book, I want to focus on how you can not only empower yourself but also empower others with these principles- in essence how you can become a successful leader.
Successful leaders have found that empowerment results from finding a leverage point from which they can encourage others to see the necessity of trying something new. Good leaders help others to develop a willingness to change behavior and take risks. They develop the skill to reach the emotional wellsprings of belief, motivation, courage and perseverance, which help contribute to trading success in themselves and others.
The rapid success of many billion dollar hedge funds in the twenty first century has created a new breed of leader who has been extraordinarily successful before assuming the mantle of leadership. Hedge fund leaders often start off as successful stock pickers, analysts, or portfolio managers. Their leadership skills are often neglected or non-existent prior to their assumption of a management position. This is very different from the progression in other organizations where the leader has ample time and training over many years to hone the skills of leadership. Some hedge fund managers are adjusting to this challenge with ease, but many are struggling.
To become a successful leader, you need to learn how to:
Be transparent and to tell the truth
Listen well and speak clearly
Encourage others to buy into your strategy
Choose the right people for the right jobs on your staff
Uncover and unleash your team members' strengths
Be tough with those who don't accept your ideas
Crank up the energy level in your organization
Build and sustain momentum, and
Learn and implement strategies that avoid both burnout and euphoria.
The primary key, of course, is to know yourself, and to have an understanding of some of the psychological forces pulling you and others in opposite directions. By doing this, you will discover how to make sure that when you are no longer in charge you have left a legacy that will keep your organization advancing forward.
The key to developing mastery and leadership is a willingness to be open and to share your experiences, both good and bad. Of course, this requires that you first overcome a variety of limiting beliefs and stopping points that serve as obstacles to becoming an autonomous, emotionally connected decision-maker. This begins with a considerable amount of self-examination. Ultimately, self-examination becomes the paradigm for transformative leadership in which you can become even more powerful and effective in your own trading life and in terms of your impact on supporting others in the process as well.
In effect, the willingness to talk openly about your personal trading issues will enable you and your team members to get past the need to appear stronger and more confident than you really feel inside. As you expose your weaknesses and frailties, ambitions and dreams, and get past the need to maintain a facade of competence, you will become amazingly alive and empowered by the process and discover a tremendous amount of support that exists for you and others in this shared experience.
The more you learn about your team, the more you, as a leader, will be able to help your team to improve their processes, to maximize their creative input and to give them a greater sense of ownership. When an open dialogue is created, there will be an increased awareness of millisecond responses associated with hesitation about pursuing objectives. Leaders and team members will become more adept at discerning quick, subtle, non-verbal emotional communication and other clues that can help traders to push themselves even farther than they imagined. Along the way, you will gain a glimpse of a new future- a future in which team members can make more decisions on their own and have a greater role in their own destiny.
8.A flat organization is different from the way in which many of us have experienced the business world, but it can offer opportunities that we may have never considered possible before. The flat organization is a structure designed to tap into the creative talents of the people in the organization in the best possible way by encouraging autonomy and self-directedness within the framework of a firm's larger objectives and vision.
A leader in a flat organization may find some initial discomfort in the new surroundings. After all, leadership in this type of atmosphere requires sharing (not hoarding) research and information. It requires leaders to be emotionally sensitive, open and yes, even vulnerable. If leaders can master these strange waters, they will soon learn that these characteristics are consistent with the psychological openness and tolerance of uncertainty, ambiguity and change, which enable the best traders to navigate the marketplace. By surrendering their ego and maximizing their trading performance, the best hedge fund leaders will be able to empower their colleagues and teammates and discover that managing a flat organization enables the leader to tap the hidden potential of every team member.
[ view entry ] ( 411 views )
In some situations, brain images of drug addicts are indistinguishable from those of traders, a researcher has found.
By JENNY ANDERSON
Published New York Times: February 7, 2008
[ view entry ] ( 482 views )
To activate authentic leadership, you must put yourself on the line to resolve personal issues and take the first steps towards personal mastery. When you are more present-centered and psychologically at risk, you will be an ideal medium for growth.
The key to developing mastery and leadership is a willingness to be open and to share your experiences, both good and bad. Of course, this requires that you first overcome a variety of limiting beliefs and stopping points that serve as obstacles to becoming an autonomous, emotionally connected decision-maker. This begins with a considerable amount of self-examination. Ultimately, self-examination becomes the paradigm for transformative leadership in which you can become even more powerful and effective in your own trading life and in terms of your impact on supporting others in the process as well.
As you learn how to act independently of your own blocks and fears, you can begin to see how you can lead your teams towards greater performance. To the extent that you can reveal your own vulnerability and sense of uncertainty, you will develop greater mastery and become an invaluable leader to your team.
In effect, the willingness to talk openly about your personal trading issues will enable you and your team members to get past the need to appear stronger and more confident than you really feel inside. As you expose your weaknesses and frailties, ambitions and dreams, and get past the need to maintain a facade of competence, you will become amazingly alive and empowered by the process and discover a tremendous amount of support that exists for you and others in this shared experience.
This type of communication doesn’t happen by accident, especially in the harried world of trading. A good leader will have to make communication a priority and work to establish opportunities for the team to develop communicative skills. Whether in a regular weekly consultation or within an intensive several hour consultative seminar, I encourage you to set aside a specific time to examine a variety of issues with your trading team. As you and your team openly discuss, you will rapidly get at the heart of some of the issues that keep people from being as effective as they can be as traders and leaders. Begin by addressing the following items:
* The most common psychological problems: lack of specific goals, an inability to cut losses, panic, fear of success, fear of losing, euphoria, gambling impulses, perfectionism, etc.
* Problematic trading patterns: not trading big enough, not holding long enough, holding too long, excessive caution, inflexibility, paralysis by analysis, excessive risk-taking
* Examples of trading strategy in terms of sizing, conviction level, price targets and P&L goals
* Examples of investment ideas vis-a-vis specific companies, in terms of bullish and bearish case, catalysts, risk/reward parameters, and variant perception (what was known at the time of the investment that no one else knew which gave them a trading edge)
* Examples of best and worst trades
* Summary sheets of trading statistics, if available, in terms of P&L, amount of capital being used, percentage of winning days, ratio of average amounts of money made on winning days/ average amounts of money lost on losing days, and any other statistics which might be illustrative of trading patterns
* Thoughts about trading objectives
* Examples of experiences in dealing with analysts, risk management, and management—including communication issues, command and control issues in the organization and the like in order to empower the team by initiating openness and the sharing of vulnerabilities
* Receptivity to coaching—how much the team can admit to vulnerability and the need for support
* Spreadsheets illustrating the sizing of positions, hedging strategies, and level of conviction of ideas
The more you bring to the table, the bigger the impact the meeting will have on you and your team and the more you will accomplish during the session. If you really put yourself out there, by exposing some of your own performances as well as the performances of the people on your team, and if you are willing to explore the good and the bad, what works and what doesn’t work for yourself as well as your team members, then you will walk away with a huge win in terms of understanding behavioral and attitudinal changes in yourself and others.
This open dialogue will translate into profit potential in your own trading and that of your team. Perhaps most importantly such a dialogue invites the opportunity to break through and develop team connections. There is suddenly an opportunity for everyone to see that leadership is not about demanding something from people but about providing a setting in which everyone can voice concerns, fears, self-doubts, differences, and even disagreements without fear of retribution.
Group discussions encourage people to see the nature of sharing, help overcome the natural reluctance of others to speak out, and challenge the status quo. As team members learn to share their dreams and identify everyday obstacles in the life of the organization, what often emerges is an amazing interaction that was not previously present due to fear or lack of time or opportunity. Such discussions will help foster a sense of teamwork, loyalty, and motivation as well as motivate better performances and a more competitive edge.
[ view entry ] ( 425 views )
Larry Jacobs, Editor of Traders World Magazine interviews Ari on the ability to master your fears in the face of uncertainty and change in the market. Download the mp3 file here
[ view entry ] ( 498 views )
Shaky stock markets, scary energy prices, continued credit calamities, dollar woes, not to mention rising tension in the radical Muslim world and an uncertain political future...
[ view entry ] ( 459 views )
Calendar
