How To Think Correctly

[Atilla]

There are those who want to be taught what to think and there are those who want to be taught how to think. I'm one of the latter. So is, I suspect, chump. Are we right? I can't say. But being taught what to think is not my style.

Therefore, those who want to be taught what to think are wasting my time and theirs by asking me what they should think. Those who want to be taught how to think, on the other hand, and there have been a few, are a real pleasure.

Db

If there are successful traders out there who have a successful trading system, yes I would like to be taught what that system is. I would like to know how they think and feel. Psychiatrists can teach people anger management or cure phobias. It's been done. Annarexics are brought back into the real world. Why not teach successful trading techniques and correct thought and interpretations.

If there are no such systems and these exchanges are about searching for that system then I would like to find out about other peoples approaches, applications or methods as well as share mine in that quest to refine gain share knowledge. Parting what you are thinking instead of teaching me how to think - will it really skew my thought processes to the extent that I will not be able to weigh that information on it's merit?

I with a CAPITAL I like your good selves will decide what to think at the end of the day. The money is mine to lose the money to gain is not yours - surely so. Do you really believe as soon as you tell people how to think they just think that way and in some altruistic way you are saving themselves from thinking incorrectly and they have no intellect at all? I'm absolutely flabbergasted.

"I may be a simple man, but I know what love is." - Forrest Gump

 

[darkwanderer]

I would have thought that the subconscious is more of a hinderance than a help, where trading is concerned. Conscious thought and knowledge is what needs to be applied. Subconscious thoughts don't really fit plans that well. As for all that rubbish about climbing out of yourself...it's mostly nonsense.

 

[SOCRATES]

At last this thread starts to get interesting!

The way I look at this is that anyone who’s trading successfully, at whatever level will have spent a considerable amount of time and effort at some time stumbling around in the dark, finding a trading style that’s comfortable, and confronting the typical problems that we all have faced at some point on the journey. In simple terms doing the work DBPheonix advocates.

I assumed that the 6 step plan presented by Socrates would only be applied when “trading”, as opposed to gambling, or taking random entries, or generally being completely without a clue as we all where at some point in our development.

I’m not at all sure if Socrates is advocating using such an approach whilst an individual is stumbling around in the dark clueless, or whilst an individual in the process of undertaking the work that definately needs to be undertaken before getting into a position where you at least stand a fighting chance. Hopefully he’ll clarify this point.

If he is, that would seam rather a strange approach, I will concede that there is more than one way of skinning this particular cat, but it’s an approach that I personally wouldn’t be particularly comfortable with.

I would have thought that if you’re at the stage where you’re approaching the markets with a reasonable strategy or plan that these types of approachs do start to have some value, for some individuals, and some trading styles.

In my own situation I trade a system which involves a degree of discretion, and can see how this simplified 6 step “control mechanism” is actually in operation whether I like it or not. I’ll be honest, I hadn’t explicitly though of it in the terms Socrates describes, as Im more focussed on the mechanical elements at this stage of my development, but nevertheless the mechanism does exist even though I’m not actually consciously controlling or managing it. I think Ive managed reasonably well without actually being aware of the process, maybe concentrating on this aspect will improve my trading and maybe it won’t, but it doesn’t hurt to consider it.

On the other hand, I also trade a non discretionary system based on currency pair correlation, this model is statistically driven, and in this case this particular “control mechanism” makes no sense whatsoever. The software simply does what it does based on tens of thousands of hours of research, ego, psychology etc simply arnt an issue in this case.

regards
mick

This cluster of steps, which is a very basic cluster, is for use at a mechanical level for traders who are already proficient at a mechanical level, nearly past guesswork, and on the threshold of reasonable expectancy. It does not work otherwise. It does not pre empt actually attaining mechanical proficiency. Mechanical proficiency has to be mastered first and then the basic cluster as described can be used.

Intuitive proficiency includes other protocols not included in this cluster. This cluster as presented is in its most basic form and is for use only up to the perimeter of mechanical proficiency.

 

[dbphoenix]

If there are successful traders out there who have a successful trading system, yes I would like to be taught what that system is. I would like to know how they think and feel. Psychiatrists can teach people anger management or cure phobias. It's been done. Annarexics are brought back into the real world. Why not teach successful trading techniques and correct thought and interpretations.

If there are no such systems and these exchanges are about searching for that system then I would like to find out about other peoples approaches, applications or methods as well as share mine in that quest to refine gain share knowledge. Parting what you are thinking instead of teaching me how to think - will it really skew my thought processes to the extent that I will not be able to weigh that information on it's merit?

I with a CAPITAL I like your good selves will decide what to think at the end of the day. The money is mine to lose the money to gain is not yours - surely so. Do you really believe as soon as you tell people how to think they just think that way and in some altruistic way you are saving themselves from thinking incorrectly and they have no intellect at all? I'm absolutely flabbergasted.

"I may be a simple man, but I know what love is." - Forrest Gump

As I said in what you quoted, if you want to be taught what to think, knock yourself out. But that's not my style. And if you want somebody to teach you their system, that's entirely up to you. It's your money.

As for learning about others' approaches and strategies, there are thousands of posts here on these subjects. Read them. Study them. Ask questions. You can also study the old reliables: the CWH, the Ross Hook, the Darvas Box, the MA XO, MACD, DMI, ADX, CCI, and on and on and on.

But unless someone is interested in teaching you how to trade his approach or system, don't expect him to provide any details of how he trades. It's irrelevant. If he instead is willing to teach you how to develop your own strategy but you're not interested in that particular effort, that's not his problem.

I know someone who's gone through $70,000 in seminars and courses and "mentoring" and still hasn't the least idea how to trade. But, if your account is sizeable enough, you may be luckier.

Db

 

[SOCRATES]

I'll agree with that, Socrates, and from there advance my further point that seeking objectivity requires external referencing. At the very least we need to have others in our lives that help us to see where we are stuck in automated reactivity. Seeing our reactive nature within a context that includes other modes of reactivity can also help greatly. Its so easy to excuse our flaws, but magnify those of others.

If others wonder what I use for context, take a look at a section I have up on my site that I call the Enneagram of Trading and Investing: http://www.s2pmarketsignal.com/Investing_Psychology.htm. I really think traders and investors can benefit greatly by understanding their own reactivity within this framework.

May I rephrase this for you ? This is because I can see where you are coming from... ....and I can suss the probable source of your ideogram...

OK...here goes...

I'll agree with that Socrates, and from there advance my further point that seeking objectivity requires both internal and external referencing. At the very least we need to have others in our lives to help us to see where we are stuck in automated reactivity and to raise our levels of individual and collective awareness to be able to recognise these blocks, whnich exist initially through no fault of our own, but that we ourselves have to strive to clear.

Therefore, seeing our reactive nature within a context of other reactivity can only help if we ourselves decide and set about rectifying these inabilites. It is not a question then of excusing our flaws but construcitvely for the purpose of trading, to set about correcting them and eliminating reactivity. It then becomes not so much a case of maginfying those of others,but to reverse engineer one's whole awareness to a level where previoulsy what was the norm has been exchanged for a new existence and consequently what previously applied is now obsolete.

Better ? Got It ?

 

[dlpirl]

Market Motivations

Understand that the market doesn't know who you are or, even if it did, care what you want. Also understand that you have several choices of approaches. You can approach it as a gladiatorial combat (this is bertie's choice; he enjoys gladiator movies); as a game of chess; as sailing (Ruth Roosevelt has a good article on this); as a tracker and hitchhiker, stalking the elephants, then going along with the ride that they provide until they stop or change course; and so on. Your choice will depend partly on "who you are". But it must also depend on what is productive (you can, of course, drive yourself into bankruptcy through a stubborn devotion to a losing strategy, but this is not productive).

You must then decide just what it is you want from the market. Are you recreational? Are you looking for the same adrenaline rush you get from games of chance or extreme risk sports? Are you looking to supplement your income? Make a living at it? Are you looking for a hobby? a diversion? a career? a way into something? a way out of something (or away from somebody or something)?

And there's more, all of which is addressed in the Trading Journals posts linked in my signature.
Db

Hey, Db, I think we are pretty close to being on the same page. We seem to be agreeing that Trading Psychology needs to be individualised and I agree with your starting point of being conscious and intentional about what we are trying to get out of the market. You threw out some examples. I'd like to throw out some more and place them within the comprehensive system of the enneagram.

Looking to profit in the the market by...
E1) Applying a focused system with disciple.
E2) Gleaning wisdom from a financial "guru".
E3) Attracting others to my image of success by only showing what works.
E4) Finding a few undervalued unknown high quality stocks.
E5) Distilling a great deal of information into a quirky, but personal investment style.
E6p) Carefully hedging and not losing capital
E6c) Risk it all by "shooting for the moon"
E7) Always being on top of the latest trend.
E8) Great confidence in my gut level decision making ability
E9) Finding the "middle ground" or hedging differing alternatives.

Of course these are not the only alternatives, but examples from each of the nine enneagram types to give a feel for the comprehensive nature of the system.

 

[dlpirl]

"beingness"?

May I rephrase this for you ?
Better ? Got It ?

Good restatement. I am sure its better for you. Not sure about others. "beingness" is a bit trite for me. Less reactivity means a greater ability to live in the now. Yes, that's what will help us.

 

[dlpirl]

Conscious vs. Unconsious

I would have thought that the subconscious is more of a hinderance than a help, where trading is concerned. Conscious thought and knowledge is what needs to be applied. Subconscious thoughts don't really fit plans that well. As for all that rubbish about climbing out of yourself...it's mostly nonsense.

I'm certainly in the opposite camp. Motivations you are not conscious of can certainly sabotage your trading.

 

[dbphoenix]

Hey, Db, I think we are pretty close to being on the same page. We seem to be agreeing that Trading Psychology needs to be individualised and I agree with your starting point of being conscious and intentional about what we are trying to get out of the market. You threw out some examples. I'd like to throw out some more and place them within the comprehensive system of the enneagram.

Looking to profit in the the market by...
E1) Applying a focused system with disciple.
E2) Gleaning wisdom from a financial "guru".
E3) Attracting others to my image of success by only showing what works.
E4) Finding a few undervalued unknown high quality stocks.
E5) Distilling a great deal of information into a quirky, but personal investment style.
E6p) Carefully hedging and not losing capital
E6c) Risk it all by "shooting for the moon"
E7) Always being on top of the latest trend.
E8) Great confidence in my gut level decision making ability
E9) Finding the "middle ground" or hedging differing alternatives.

Of course these are not the only alternatives, but examples from each of the nine enneagram types to give a feel for the comprehensive nature of the system.

I doubt that we agree that "trading psychology" needs to be individualized. Nearly all -- or all -- of the difficulties which beginners and not-so-beginners have with "trading psychology" vanish when they begin applying a consistently profitable strategy.

Trading is far simpler than beginners are given to believe. And they needn't pay anybody a dime in order to learn how to do it.

Db

 

[SOCRATES]

Good restatement. I am sure its better for you. Not sure about others. "beingness" is a bit trite for me. Less reactivity means a greater ability to live in the now. Yes, that's what will help us.

OK, well call it existentialism or self awareness or whatever fits the way you are wired.

 

[darkwanderer]

One of the most vital things you will need for trading, is memory. Let's not confuse memory with the subconscious.

 

[dlpirl]

integration of trading and life

I doubt that we agree that "trading psychology" needs to be individualized. Nearly all -- or all -- of the difficulties which beginners and not-so-beginners have with "trading psychology" vanish when they begin applying a consistently profitable strategy.

Trading is far simpler than beginners are given to believe. And they needn't pay anybody a dime in order to learn how to do it.

Db

Looking for an argument, Db? I'll try not to give you one. I agree that trading mechanically is much simpler than most people realize adn that you don't need to pay anyone to help you learn how to do it well.

Yet, because there are many systems out there, its not too easy to find which one is right for you, or to learn enough to build your own. Didn't you say that each of us needs to decide what we want to get out of the market? Finding yourself in the matrix of those possibilities is a way to begin the self understanding process to become a better trader.

I guess I really do need to differ with you about problems with psychology vanishing once beginners apply a profitable strategy. I know a financial advisor who got into that field from psychology. His motive was to help people solve their basic financial needs so they could become "self actualised". He grew their money, but guess what happened. They became greedy and their financial needs just grew. He became quite depressed about this -- his inability to help people, and began to realize that personal growth needs to accompany financial growth. No, you don't need to pay anyone, but IMO if you are not a a path of personal growth, you WILL sabotage yourself and your trading.

 

[dlpirl]

Non-existential

OK, well call it existentialism or self awareness or whatever fits the way you are wired.

Oh, I am quite non-existential, socrates, bertie.

 

[SOCRATES]

Looking for an argument, Db? I'll try not to give you one. I agree that trading mechanically is much simpler than most people realize adn that you don't need to pay anyone to help you learn how to do it well.

Yet, because there are many systems out there, its not too easy to find which one is right for you, or to learn enough to build your own. Didn't you say that each of us needs to decide what we want to get out of the market? Finding yourself in the matrix of those possibilities is a way to begin the self understanding process to become a better trader.

I guess I really do need to differ with you about problems with psychology vanishing once beginners apply a profitable strategy. I know a financial advisor who got into that field from psychology. His motive was to help people solve their basic financial needs so they could become "self actualised". He grew their money, but guess what happened. They became greedy and their financial needs just grew. He became quite depressed about this -- his inability to help people, and began to realize that personal growth needs to accompany financial growth. No, you don't need to pay anyone, but IMO if you are not a a path of personal growth, you WILL sabotage yourself and your trading.

He is not a path of personal growth but a path of personal obstacle, trying his best to sabotage everything and everyone..... ...or have you not yet realised ?

 

[dbphoenix]

Looking for an argument, Db? I'll try not to give you one. I agree that trading mechanically is much simpler than most people realize adn that you don't need to pay anyone to help you learn how to do it well.

Yet, because there are many systems out there, its not too easy to find which one is right for you, or to learn enough to build your own. Didn't you say that each of us needs to decide what we want to get out of the market? Finding yourself in the matrix of those possibilities is a way to begin the self understanding process to become a better trader.

I guess I really do need to differ with you about problems with psychology vanishing once beginners apply a profitable strategy. I know a financial advisor who got into that field from psychology. His motive was to help people solve their basic financial needs so they could become "self actualised". He grew their money, but guess what happened. They became greedy and their financial needs just grew. He became quite depressed about this -- his inability to help people, and began to realize that personal growth needs to accompany financial growth. No, you don't need to pay anyone, but IMO if you are not a a path of personal growth, you WILL sabotage yourself and your trading.

No, I'm not looking for an argument. You brought me into this arc by addressing your post to me. I only want to make it clear that I disagree with most of this "trading psychology" nonsense. If you don't agree with me, that's perfectly okay. You're not the only one.

As for your friend, I have a degree in psych myself, and trading is not therapy. Anyone confusing the two is likely to wind up as depressed as your friend. The point of trading is to make money, not to find oneself. If one's goal is the latter, volunteer for a boys' club. Or UNICEF.

I don't know you, though you do seem to be quite insistent about your services and their value. But then you're a vendor, so this is to be expected. However, I find it interesting that those who most often stress "trading psychology" are those with something to sell.

Db

 

[SOCRATES]

I am enjoying this enormously.......isn't it a hoot ?

 

[dbphoenix]

He is not a path of personal growth but a path of personal obstacle, trying his best to sabotage everything and everyone..... ...or have you not yet realised ?

No, my path is making money. Otherwise, why bother? :cheesy:

 

[dbphoenix]

So far I have realized that you detest each other. I am not quite sure why. I do like Db better than you, though. You seem quite arrogant.

You probably won't like me, either. I'm also arrogant, but at least I try to be helpful (and am at least marginally successful since I was voted at the top of that category last year -- helpfulness, that is; no category for arrogance).

Db

 

[dlpirl]

Arrogance

You probably won't like me, either. I'm also arrogant, but at least I try to be helpful (and am at least marginally successful since I was voted at the top of that category last year -- helpfulness, that is; no category for arrogance).

Db

Sorry, but your response make me like you

 

[dlpirl]

Buttons

Dry rot

Otherwise, when he does say something that makes sense, it's always taken from somebody else, usually Tom Williams, whose work is based on Wyckoff (again, look at Sebastian Manby's posts: VSATrader), who makes more sense than just about anybody. But you can save yourself a lot of aggravation by reading Wyckoff or Williams.

Db

Actaully, it really seems that bertie's skill at pushing buttons can be extremely useful leverage for personal growth. This is a priciple I learned in retrospect from my exwife. To have your flaws or sensibilities exaggerated can be a great learning experience once you are able to put it in perspective.