Its successful use of sophisticated mathematical modelling and algorithms led to Shaw becoming known throughout the finance world as the ‘Quant King’.
Here are 9 of David Shaw’s best quotes
David Shaw often spoken of his view of the markets, that first developed in childhood.
“I grew up with the idea that, if not impossible, it was certainly extremely difficult to beat the market. And even now, I find it remarkable how efficient the markets actually are.”
As a computer scientist, David Shaw is of course logical and analytical, but here he also emphasises the need to be patient.
“The only way to make money in the markets is to be patient, disciplined and informed. You have to have the confidence to make decisions based on sound analysis and rational thought.”
“Don’t forget that trading is a business. You need to have the right mindset and treat it like any other business. That means setting goals, risks and rewards, and having a well-thought-out trading plan.”
Rational or not, all traders have to accepting of the fact that not all trades can be profitable.
“As a trader, you have to understand that some trades will be winners, some will be losers. That’s part of the business.”
Is trading gambling?
Here, David Shaw relies with an emphatic ‘no’.
“It’s important to remember that trading isn’t gambling. You can’t just rely on luck or a hunch. You have to do your homework and understand the markets and the risks involved.”
As traders, we can get caught up in the result of individual trades, but it’s important to be able to zoom out take a longer-term perspective.
“Successful trading requires a long-term approach. You have to be able to think about the big picture and understand the trends and cycles of the markets.”
It’s always useful to be reminded that trading is effectively risk management.
“It’s important to remember that trading isn’t just about making money; it’s about managing risk as well.”
Having a robust system is essential, but all successful traders talk about the need to adapt to changing market conditions.
“You should also be prepared to adjust your system as the markets change and evolve.”
And finally, this last insight is mentioned by some other traders, who realise that to trade well, traders have to be OK in the rest of their lives, but that also, trading well helps develop the skills needed to live well.
“If you approach trading with the right attitude, you can gain valuable insights and skills that can be applied to other aspects of your life.”
