Think Like Everyone Else, Lose Like Everyone Else | Brent Donnelly

**Brent Donnelly** (0:00)
If you think like everyone else, you'll perform like everyone else. You need to have some kind of divergent or independent thinking to have an edge and to make money. I'm so much less trying to predict what the central bank's gonna do or what the data's gonna do, and I'm more trying to predict what are the humans gonna do. As a new Fed chair, you have to be hawkish. You have to say we're committed to the inflation target. That's just what you do. In terms of FX, it's still the same thing. Rate differentials will be the main driver. The only idiosyncratic story is Japan, but it's still the same story.

**Felix** (0:30)
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All right, what's going on, everybody? Welcome back to another episode of Forward Guidance. And joining me today, super excited to have Brent Donnelly, president at Spectra Markets, and a fellow Canadian who showed up today on the show with a Brazil jersey. So I had to go run out and get my Canada jersey because we can't have two Canadians on one show without at least one jersey on. So Brent, what do you got going on?
What's with the Brazil jersey?

**Brent Donnelly** (1:24)
I will say I like the black jerseys yesterday that Canada was wearing.
So I'm a bandwagon soccer fan, so I will definitely be a Canada fan all days except for when days at Brazil is playing. I got my Brazil jersey. We have probably most of my favorite clients are in Brazil, so I got to represent at least on their behalf.

**Felix** (1:45)
Nice. Fair enough. Yeah. I mean, we're not used to even having Canada in the World Cup. So I've always been an England supporter because we didn't even have a Canada team to support until a few years ago.

**Brent Donnelly** (1:54)
Yeah, it's great. Imagine being a kid playing soccer right now in Canada. It's so inspirational.

**Felix** (1:59)
Oh, it's so cool. I love it. Brent, wanted to get you on because you have a new book.
In your previous book, Alpha Trader, I put out a tweet when I finished reading it, and it went not fully viral, but people got really excited about it because it was seriously one of the best trading books I've ever read, really phenomenal stuff, and you have a new one out. So I would love to just start off there, talk to us about this new book and what led to you to writing it.

**Brent Donnelly** (2:27)
Sure. So first of all, I appreciate it. Thanks. I mean, I don't do much marketing, so it's all word of mouth. So like you and some crypto people and stuff like that have been instrumental in getting the book out there. So thank you.
So the new book, Alpha Trader, as you know, but if people haven't read it, is kind of my attempt to bring together the main disciplines of trading because I feel like a lot of books focus on either a lot of books focus on psychology or trade selection. And to me, there's just so much more to it, obviously, especially risk management, which I think is very underrepresented in books. So trying to bring all the. So if you create a box of like fundamentals, technicals, behavioral and quantitative, that's kind of like the box of most trading books fall within that. And Alpha Trader was trying to kind of bring those four together and just kind of do some case studies and examples of my own experience. And so my new book is called Trade Outside the Box. So you could imagine that I'm trying to go beyond those four walls and talk about things from outside of trading. A lot of them, a lot of the inputs that I use are from my experience with different things like poker would be one main thing and clinical psychology, like addiction, gambling disorder, all that kind of stuff really come into trading a lot. So my time spent with performance coaches and psychologists kind of stuff in terms of trading has had a big influence on me. And then the other thing is, like the tagline for the book is if you think like everyone else, you'll perform like everyone else. And the point being like that's a pejorative statement because most people underperform the index and most traders lose money. So you need to have some kind of divergent or independent thinking to have an edge and to make money. And a lot of that for me comes from outside domains and applying the concepts to trading. So that's what I want to do. So like there's a whole chapter in there on how I use poker to hopefully become a better trader. Like you get a lot more reps in poker than you do in trading. But many of the sort of core philosophies of poker, like tight, aggressive, for people that don't play poker, that concept essentially says, you fold your hands a lot and you fold all the bad hands. But when you have a good hand, you have to be courageous and aggressive. So it's kind of like the combination of extreme patience, but also extreme aggression, which is, you know, most individuals tend to have a personality that's one or the other.