- The Turtle Trader or Investor
- The Pig Trader or Investor
- The Ostrich Trader or Investor
- The Lemming Trader or Investor
- The Sheep Trader or Investor
- The Barefoot Pilgrim Trader or Investor
Turtle - A nickname given to a group of traders who were a part of an 1983 experiment run by two famous commodity traders, Richard Dennis and Bill Eckhardt. The goal of the study was to prove whether being a great trader was a genetic predisposition or whether it could be taught. Dennis believed that a person could be trained while Eckhardt thought it was an innate skill.
Pig - An investor who is often seen as greedy, having forgotten his or her original investment strategy to focus on securing unrealistic future gains. After experiencing a gain, these investors often have very high expectations about the future prospects of the investment and, therefore, do not sell their position to realize the gain.
Ostrich - A slang term given to investors or other market participants who ignore important pieces of information or situations, which have the ability to impact them or the market in which they operate. The reasons behind type of action can include risk aversion and bias.
Lemming - The act of following the crowd into an investment that will inevitably head for disaster.
Sheep - An investor who lacks a focused trading strategy and trades on emotion and the suggestions of others, including friends, family and financial gurus. This type of investor often makes rash investments without reviewing their financial viability. The behavior of sheep contrasts with that of bulls and bears, who have focused views about the market.
Barefoot Pilgrim - Slang for an unsophisticated investor who loses all of his or her wealth by trading equities in the stock market.
Which kind are you?