Trade Like A Superhero

Traders Assemble!


I wanted to write this, after enjoying a mini-marathon of superhero films which provided escapist mind-candy for me and my brother this past weekend. These films are great fun: the good guys always win and the bad guys always lose - sadly unlike in real life. One connection to real life however, is the notion of right and wrong. In the world of trading and investing, we can cast that as profitable and unprofitable, but I much prefer process-based vs. ego/emotion-driven.

As traders and investors, we aspire to monetary feats of greatness, as recounted in oversimplified portrayals of contemporary success stories and references to traders and investors, some long past retired or living on in books. Paul Tudor Jones, George Soros and Stanley Druckenmiller come to mind, but these days it’s Ray Dalio as well. Warren Buffett is especially relevant, as I draft this piece, after a recent 50th anniversary of his Capitalist “Woodstock” - the annual Berkshire Hathaway meeting. Li Ka Shing is a personal great for me. Others look to Carl Icahn and other practitioners of what is currently described as “activism”. A common favorite for many is Jesse Livermore, a tragic market “hero” with inspirational and cautionary lessons.

I seem to recall Einstein describing compounding as one of the most powerful forces in the Universe but I want to go back to thinking about the relevance of some fictional heroes for traders and investors. Yes, you read that correctly. Let’s start with heroes possessing somewhat less-Einsteinian powers and see what we can learn. Traders Assemble! (Sorry, I couldn’t resist and some of you knew it was coming.)

I’m a fan of what Marvel has done, both with the franchise and how after even a lot of film editing, the films still manage to cast the inner frailties of the lead characters in sharp relief against some amazing abilities. (Carl Icahn certainly showed his superpowers since Marvel was one of his distressed investments became a profitable “Amazing Fantasy”. Extra comic fan inside joke.) In fact, let’s go through the roster of the superhero team Avengers, as our case study.

Captain America: The Power of Integrity

Growing up, my kid brother and I were fans of Spider-Man, but Captain America stuck with me as well. My brother was so little and still struggling with syllables, he called him “Mucka Mucka” and that name stuck. We both loved Mucka Mucka. Here was a guy from a neighborhood not unlike our own, who was on the outside at first, small, not physically imposing, but he made up for it with his self-belief, his internal compass about right and wrong and being able to steer his life by it. A little super-smoothie injection and blast of radiation in a 1940s souped up tanning booth would combine with the hero already inside Steve Rogers and transform his body but not his heart.

I propose to you, traders (and other folks in every walk of life) that a strong belief in one’s life mission/ purpose, combined with other resources, goes a long way for your personal “hero’s journey”. In your case, as for resources, we’ll skip the radiation and the non-FDA approved chemistry, and substitute it with knowledge. We’ll do a different take on “Cap’s” focus on gymnastic perfection (he sure could aim that shield of his) with a lifelong pursuit of learning and personal growth. Tony Robbins/Joseph Campbell alert! Combine the pursuit of increased trading gymnastics with a belief in your mission, and you’ll survive those long “cold streaks” in your portfolio/trading as well as Cap did during his long frozen slumber, and come out swinging.

The best result is if you prosper as an investor or trader but you still get to keep all the good tucked away inside, from before your transformation.

Iron Man: Resources are not enough

Sure, billionaires are assumed to have vast resources + self-belief - but what if you’re stuck out in the wild, with your heart ready to pop at any moment?

We have seen many investors and businesses blowing up in size while some were later blown away in a gale of bankruptcy, liquidation and litigation. We have also seen amazing pivots and reinventions of people. T. Boone Pickens was an old school Oklahoma oil & gas man who started as a geologist and went through some boom but also bust cycles in his life. At one point he was at his lows but found a way to save himself. I keep reading lately about startup “Slack” and how the “last 6 million” became something amazing out of necessity. There are so many stories like this out there. Many of us already know how a fallen textile giant would be transformed into a financial juggernaut that sells nice candy and jewels on the side, run by a man fueled by an endless stream of Coca-Cola. (As for me, my favorite stories are all very personal, and they’re about my parents and how they overcame a lot of challenges. Many of us can relate to that. But that’s for another post or book.)

We all might be able to relate with the idea of saving ourselves through transformation. The life of one fictional wealthy industrialist, Anthony Stark, is relevant. At death’s door — courtesy of some shrapnel making a beeline for his heart — Tony Stark, used his ingenuity, with help from another scientist, to save his life. In the process he defeats the villain responsible, a tribal warlord but Stark doesn’t stop there. He changes his business model, “privatised” national defense and begins the long process of saving himself as a person. (Stark still had parental abandonment issues caked over with hard-partying and an excessive “Selfie” lifestyle and he eventually deals with that too.)

Stark had all the resources in the world but he was stuck far away from home, at death’s door and had to rely upon his intelligence to survive. Sometimes, believe it or not, it’s not enough to be the smartest, strongest or sexist person in the room. Stark had to get help, and so do you and I. We need the help of family, friends, mentors, and those who see us as we would like to be seen to help us. Stark’s ego was useless in a third-world cave but the help of a good friend made the difference. Iron Man 1.0, both the suit and the man, was cludgy but it worked and Stark improved upon it constantly. He never stopped and soon future iterations, his “2.0s” and beyond would build upon and eclipse this life saving innovation. Stark also pivoted from being a merchant of death, a Lord of War, and became an H.R. recruiter of world savers known as “The Avengers” because he needed help. Your ambitions don’t have to be that lofty.

I’ll cut to the chase. Save yourselves as traders. Use your ingenuity and get help. Use books and the wisdom of others, learn to listen and listen to learn. Too many traders and entrepreneurs go all in on their egoism and soon enough, not only are they running on fumes, those fumes are making them dizzy. Maybe you had the money or lost it and you’re at “death’s door”. You can then stop the shrapnel which is making its way near your heart.

We have all read Market Wizards (I refer the chapter on Michael Marcus for both newbies and veterans alike, and you’ll understand what I mean). Don’t feel bad. Feel inspired. Build yourself some trading armor that works for the shrapnel heading for your heart. But you can’t stop there even after the heroic act of saving yourself. You have to press on to new challenges and keep improving. And maybe you can improve that armor and start saving others too in the process.

Thor: A Thunder God’s Ego

Have you ever seen the person who blows it out with the fancy sports car, objet du jour, drop kicking old friends to the curb, “knowing it all”, going through life with a smirk and then suddenly he, his new “friends” or his lifestyle is gone? Thor was that kind of guy wasn’t he at first? (I refer to the movie version, and the guy with the abs of admantium.)

There is nothing more invigorating than supreme self-belief, as in Captain America’s faith in America, but his moral and life compass was laced with genuine self-respect and respect for others and reality. Thor in the beginning deserved his own E TV/TMZ reality series. Sure, if all you had to do was summon some lightning and thunder in dark ages Norway to be a “God”, then you would surely feel that way too. If Thor was a celebutante he would have 100 Million twitter, snapchat, instagram, FB, WeChat, etc followers, a line of cologne and some serious sponsors and be invited to bite into some serious hamburgers for the camera. Life in the cosmos for Thor was a breeze. Until he had one moment of hubris too many.

In the wake of an allmighty father’s disappointment, Thor Odinson was disinherited, disowned and rendered mortal. Like Tony Stark, he had nothing and was far from home. Unlike Steve Rogers, a/k/a Captain America, he also lacked humility and integrity. Stuck on earth, mortal, unable to use the mighty hammer he took for granted. Can you imagine as a trader, taking a hit so hard to your portfolio and/or your identity that you lost the ability or confidence to take action as in the past? Some of you know exactly what I mean. The rest of you are either shaking your heads knowingly or you’re about to come crashing to earth and will understand soon enough.

Can you master your ego and keep it in check? Or will your inner misguided thunder-god steer your ego wrong and send your life plummeting from the celestial heights of Asgard and down to Earth? Can you find your way back and understand the value of your true resources, the person you really aspire to be inside, and not the one you portray for the sake of others on the outside?

You don’t have to make your dad proud, but you do have to be someone you can look at in the mirror. Can you evolve into someone, such that others would want YOU to be proud of THEM? Thor fell in love with a mortal and rediscovered his humanity and humility. When he embraced his “limitations”, and knew what real risk was, what the the true costs were of his choices. When he went to save the girl, he knew what he was doing. Before it might have been an empty, vainglorious decision, that would have cost him nothing. Now with real stakes on the table, the lives of others, his risk, his own very mortal life, had major upside as the reward.

Can you appreciate the power of such humility and see the reality of risk and appreciate what you can and can’t do, what you can achieve as a consequence? Can you make some serious lightning and thunder happen in your life that was worthwhile and truly rewarding? It is up to you to make yourself worthy enough to lift this mighty hammer of an opportunity.

The Hulk: Master The Beast

This one is the “easy” and obvious one isn’t it? It’s just a matter of telling yourself: “Don’t lose control? Don’t go apeshit? Don’t be led by our emotions?” NOT quite. Again, another great guy who thought some personal chemistry + radiation would “fix it”?

Here we have intelligence, we have resources,we even have some humility courtesy of living with frailty. Sometimes we did for others (Hello “Rick Jones”, go google him) and we are still up radiation creek without an antidote.

But I wonder, can we deny ourselves our humanity? We are imperfect. We are all too “human”. We have days where we go to the zoo and lose it. But how to “deal”? Meditate? Sure, that helps, really it does. Some regular tabata and/or yoga? Yes that helps too. Vacations? Yes. Retreats? Yes. Hot dates/significant others? Sure, why not? And yet we still have the beast inside as our first and last roommate in life, forever until we go to Valhalla.

Dr. Bruce Banner acknowledged as such, that he was always “angry”, that he was always human. He, however, embraced the totality of himself and found a way to make it work. So can you. Can you be INFORMED by and not just LED by your emotions? Can you be that self-aware?

Self-knowledge is just as important as technical knowledge, resources, a belief system and some kind of moral compass. Self-denial is deadly for both superheroes and traders. Wrap your head around that before your wrap your portfolio and life into knots.

Black Widow: the Mystery of Ourselves

She’s hot, she’s fast and she can kick ass. And Natalia Romanova has issues. She has a past, and she has REGRETS, lots of them. Welcome to a shadowy realm of what can’t be undone - our past. It’s a place we all visit as tourists but mustn’t assume permanent residency in.

Now can you deal with “red in your ledger?” Your past mistakes, mishaps, losses and grow from it and keep on swinging? Yes. Can you keep on wearing that hip hugging, form fitting outfit with the super zapper weapons? Well, maybe not, not even if Lululemon or Underarmour made them just for you. But you can deal with your regrets, and use them to help you right future wrongs and keep growing.

Hawkeye: Precision and the Power of Practice

One does not become an archer who can shoot the antenae off an ant (sorry Ant Man, nothing personal) at a dozen paces — not without relentless, endless learning and practice. We do not become masters of our chosen passions/craft without relentless practice. According to the comic books (and a little wikipedia research) Clint Barton started as a misunderstood villain, and was mixed up with the wrong crowd but eventually he aims for the straight and narrow, even after falling for the “wrong girl” (Black Widow used to be that bad girl). We all bumble through trading and investing, and especially in life, at some point due to inexperience or a less than steady hand. Practice, as in everything we do or want to become, makes us superhuman masters in the eyes of those who don’t practice.

Clint Barton might not have powers, a super suit, a powerful Asgardian hammer or electric zappers, but he still had the power of practice and the precision that comes with it. You never achieve perfection but you can become a practitioner of precision. You can have a power which comes off like natural ease to the uninitiated.

Assembling your inner superhero:

Let’s sum up. What do we have here, all of us, to work with — to become superheroes (at least of our trading destinies)? Here’s a list: Self-belief, ingenuity and resourcefulness, humility, self-awareness and the loving embrace of our frailties, the will and ability to reconcile with past regrets, and lastly, a relentless pursuit of greater precision (even if perfection is impossible).

Skip the super smoothie injection, the 10000 SPF rated gamma/vitaray tanning booth, deep cover post-Soviet training camp, or high tech gear. You have yourself. Attain this and you might yet get that super power all traders and investors long for, which I mentioned earlier, the great Einsteinian power of compounding.

(NO, I won’t say “Excelsior”, as I don’t have enough lawyers, but I will say good luck.)


Originally published at www.rooster360.com on May 3, 2015.