As we get ready to watch markets on the other side of the globe open, it might be helpful to think about how we think. Our brains use both the social and emotional context of a situation to decipher its true meaning. But what happens when something completely new happens? For all practical purposes, no [...]
Category: Risk Decisions
On
04.30.11 • In
Risk Decisions • by
DKS •
How many traders realize that the better models of decision making rely on a foundation of subjectivity? In other words, don’t most of us on or around Wall St. think that we are supposed to be trading via a maximum value, maximum utility or “rational man” model? I mean that surely is what I thought [...]
Generally traders, analysts and expert commentators focus purely on numbers when it comes to markets. Rarely do they /really/ look at why they do. Take the news numbers – like consumer sentiment or housing starts… why does anyone care? Well because it gives a glimpse into what people are feeling or doing right? What if [...]
On
03.10.11 • In
Fractal psychology, Learning Psych Cap, Psychoanalytic ideas for traders, Risk Decisions • by
DKS •
Having had the privilege to coach hundreds if not thousands of traders in my roles as first a trading desk manager and then as a mental trading coach, I can promise you that not matter how much capital someone is trading – $10,000 or over a billion dollars – everyone regularly asks “why the H*() [...]
As I go about proselytizing about the value of being aware of one’s state of physical, mental and psychological capital, I routinely get the same questions – 1. Exactly how to be self-aware 2. How long will it take? Let’s assume you believe that it is as important for your trading to be self-aware as [...]
Feelings and emotions are information. Feeling tired tells you you need rest, hungry – need food. Angry – something is wrong. Afraid – something to consider. Every time we recast our feelings and emotions as this kind of data is one more time that we move further forward faster. Ironically, this feeling thing also clears the cognitive “thinking” part of your brain so that it can do its more linear work.
On
09.27.10 • In
Emotion Analytics, Emotions & Decisions, Learning Psych Cap, Risk Decisions • by
DKS •
In many ways, many traders end up shrugging their shoulders to the tune of “oh well I will do better next time”. The question becomes /what exactly/ will make them perceive, decide and act “better” the next time? I mean it isn’t like there aren’t tons of methods and tools to help a trader with [...]
We all like to talk about knowing the probabilities … and then just sticking to them. Most of us like to harangue other traders for not doing so while finding it not so easy to do ourselves. It isn’t so easy for a number of reasons – 1. Whether you are conscious of it or [...]
On
07.29.10 • In
Emotion Analytics, Emotions & Decisions, Learning Psych Cap, Risk Decisions • by
DKS •
By putting yourself into your potential future emotional contexts, you can make better “risk” judgments in the here and now.
On
06.25.10 • In
Emotion Analytics, Emotions & Decisions, Risk Decisions, Trading Education, Worth Reading • by
DKS •
Here are some of the things I’ve been thinking about: The two areas in trading that separate the men from the boys (so to speak) are: 1.) The ability to divide environmental perceptions in half and process them separately. First I ask myself what I am feeling and in doing so I acknowledge and honor [...]