Women are better at trading than men

Although gender disparity is still a huge issue in the finance industry, researchers at Warwick University have found that female traders outperform male traders at investing by 1.8%. The study of Barclay’s male and female investors showed that women made more money than men over a 36-month period. The study found that women’s annual returns on investments were 1.94 percent above the FTSE 100 index, while men’s annual returns were 0.14 percent above it.

You’ve got to be a people-pleaser

As a junior trader or intern, you won’t be doing much actual work… because your job is to learn how it all works. So the only way to stand out is to stand out socially. That’s part of the reason why there are often bizarre hazing rituals where senior guys on the desk will offer juniors money if they can eat one of everything in the vending machine or do some other silly challenge. Most interns do those things because they want to fit in and impress their boss, which is one way to build a reputation as an employee.

It’s basically a fraternity

Wall Street is a place where many people are insecure, and they want to feel accepted by their coworkers. They buy into the “fraternity” mentality, which often involves going out for drinks after work, buying coffee for their coworkers or fetching their lunches. This is how white male privilege and the patriarchy persist on Wall Street: If you get a job on Wall Street because of who you know rather than what you know, then people will tend to hire people they’re used to hanging out with – and those people tend to be white men.

The GameStop saga hurt Wall Street to the tune of $20 billion

During the pandemic, GameStop’s stock price plummeted. But amateur traders active on Reddit noticed that Wall Street was short-selling the stock and decided to flip the script. They encouraged millions of users in the r/wallstreetbets channel to buy shares in order to drive up the price and increase personal profit – a tactic known as “short squeezing”. Traditional investors lost a lot of money when the stock price went up. The Sun-Times reported that the whole fiasco cost hedge funds about $20 billion. The story of how a group of Internet dwellers took on the behemoths of Wall Street and won has become an Internet legend.

The Wolf of Wall Street gets some things right

Although the storyline of The Wolf of Wall Street has been slightly altered, many former traders and investment bankers have commented on its accurate depiction of drug-fueled sex parties. Several nights a week, the company’s vice presidents and senior executives would take their employees out partying in order to get to know one another better. They would often drink heavily and attend strip clubs. Some former employees have noted witnessing vice presidents drop $10,000 to $50,000 at one bar.

Hedge funds are almost entirely unregulated

Hedge funds are less regulated than public listings because they cater to wealthy investors who can afford to take greater risks. These hedge funds can participate in riskier behaviours that aren’t available to mutual funds or index funds. There is a saying on Wall Street, “When you hedge, you take twice the risk and make half the money.” Former employees have noted that they estimate 90% of hedge funds commit crimes along the way. While there are 1000s of hedge funds, it is usually only the largest ones that are able to avoid detection.

Big hedge funds employ psychologists

Hedge funds employ psychologists to help with risk management. Two top psychologists are Ari Kiev, who worked for SAC Capital before he died, and Brett Steenbarger, who has worked for many hedge funds. Researchers have found that the testosterone levels of traders decrease after a losing trade, even if there is still money in the bank. The best traders can handle this, but they need help from therapists to stay calm and avoid making poor decisions.

Traders perform better when they’re cool

Some hedge funds have found that traders are more alert at cooler temperatures, so they keep the thermostat in the low 60s. In a 2010 cover story from Insider about Steven Cohen, who founded SAC Capital, they mentioned that Cohen keeps the temperature at exactly 69 degrees (kind of cold, to keep people perky).

Not everyone makes millions

Wall Street is a great place to make a fortune, but not everyone who works in the industry earns millions of dollars. Some traders lose money, and others retire with relatively modest savings. The average day trader makes $250,000-$500,000 a year in salary and bonuses. It’s possible to make big money if you learn how to trade stocks effectively, but it takes time and effort to build up your skills and knowledge first.

Short-term trading is usually unsuccessful

While many people think of the stock market as a place where people make millions overnight, that’s not really how it works. In fact, short-term trading is a risky way to invest your money; it’s much more likely to cost you money than to make you money. The stock market is unpredictable, so even the smallest mistake could be costly. To make money in the stock market, you need to invest for the long term. Buy stocks in companies with solid fundamentals and hold onto them for several years – if not decades.