Geoff Colvin’s Talent Is Overrated (Portfolio, 2008) overlaps at many points with Brett Steenbarger’s Enhancing Trader Performance (2006). Both offer enlightening analyses of performance; the trader would do well to read them both. I’m going to focus in this post (and a couple of planned posts) on insights from Colvin’s book. I suspect that, even though Colvin is senior editor at large for Fortune magazine, this book may never have made it to the reading lists of traders and investors.
In yesterday’s post on muscle memory I wrote about the similarities between learning to walk and learning to trade and the one huge difference—the psychological toll the latter takes. In trying to understand what he considers the deepest question about great performance, where the passion comes from, Colvin addresses this very issue. He looks at Shizuka Arakawa’s nineteen-year road to Olympic gold. Her specialty was a move that required “huge quantities of practice, and falling down during much of it. . . . Landing on your butt twenty thousand times is where great performance comes from. That fact raises the question of why anyone would go through it. . . .” (pp. 187-88)
With children and adult novices the initial motivation is frequently external. Parents set a practice schedule, for instance. Beginning traders may want to leave their dull 9 to 5 job or may need to pay some bills. But at some point in the development from tyro to master the drive to excel starts to be internalized, thus sustaining the passion. It’s possible that this is in part the result of the multiplier effect which, in one iteration, says that simply telling someone that her performance is excellent, despite its actual quality, might motivate the extra practice that then leads to improved performance, attracting more praise. Here’s an area in which traders might help each other out, since it’s hard to keep up positive self talk in the face of less than masterful performance.