Testostorone Levels and Trading
I found this article about traders’ hormones pretty interesting:
They tracked those levels against the amount of money that a trader made or lost, and against the variation in the market. What they found was that when the traders made more money, they had elevated levels of testosterone. When the markets were particularly variable, they had elevated levels of cortisol.
A further analysis showed that traders who started their days with elevated testosterone made more money than those who didn’t. One trader went on a six-day winning streak, making twice as much money each day as the previous one. Over that period, his testosterone levels rose steadily, some 74 per cent.
“The popular view is that experienced traders can control their emotions,” Coates says, “but in fact their endocrine systems are on fire.”
You use your brain for trading and it is part of your body, so the chemicals in your body are going to have an effect on your trading. This is why some traders take cognitive enhancement drugs. And this is why other traders program automated trading systems.
This quote is funny: “maybe if more women and older men were trading, the markets would be more stable.”
They also talk about the long-term negative effects of these hormones.
