What prompted this topic was a visit to The Night Owl Trader site. Two things jumped out at me when I looked over recent entries. The first was that the author is attempting to call market direction for the next day. The most recent forecast was "uncertain". I love that. Having created and recreated more regression forecasts of markets than I care to count, I know that sometimes the output says, "uncertain". That is not as appealing to some as making a table-pounding, high-conviction bullish or bearish call, but it is intellectually honest. Sometimes the evidence is balanced, and sometimes there isn't a distinctive directional edge.
The second thing that I liked was using the daily forecasts to keep score: how often the author was right and wrong on market direction. Keeping score publicly can be a particularly strong form of accountability. Over time, it can lead to useful reviews: what were the highest batting average periods? The lowest ones? What types of markets were most forecastable and which were least? How could the forecasts improve for the least predictable markets?
A while back a trader contacted me about working together. He didn't attempt to convince me of his passion for trading or his grand insights. Rather, he sent his multi-year track record, performance statistics, and a very well laid out description of his trading methodology. The message he sent was, in essence, "Here's what I do; here's how well I do it; I want to get to the next level." His track record wasn't perfect, but it was his willingness to keep score, stay intellectually honest--warts and all--, and open the kimono in the search for peak performance that made me strongly suspect he'll get to that next level--and beyond.
Those are the traders you want in your network: they will bring out the best in you through their devotion to achieving the best within them.
Further Reading: Keeping Score, Religiously
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