Yeah, I don't have a lot of will available so I will use it all up for trading.
I need to take control of my life again: I can't keep on living by default. As you said, I need to stop and think before letting that default action (compulsion) happen. I am in front of the screen, frustrated... I need to stop and think about whether I want to trade out of boredom/frustration and most likely lose money, or trade according to my rules and most likely make money.
We'll see tomorrow how it goes, once the new money wire comes in and i have money to trade again. But even today I was about to buy some cigarettes and I stopped and thought: do I want to keep a little more of my health or give in to my impulses? And then I didn't buy them. I said "no" to myself and to my urges.
I now realize that I was never Obsessive-Compulsive. I just had a very weak will-power all this time. That's why people kept calling me a "vegetable". My life was always at home, going between the bath tab, the couch and the bed, always with my laptop on my stomach. How can a vegetable say no to his compulsive gambling urges? Everything is coming together I think, the explanation is clear. Now, after describing so perfectly my problem, I need some will power to make it disappear. It won't disappear once and for all: I will constantly need will power to keep it under control.
Oh, and I didn't mention scratching my head. Ever since I was a teenager I've been scratching my head compulsively, not 24 hours a day of course, but at least once a day, except when i am on vacation and doing some physical activity like swimming. I always regretted having this habit, but I was never able to stop it. This would be a good test for my will. If I want to be profitable, I need to stop scratching my head as well. Probably being profitable at trading has more to do with being able to not scratch my head than with studying the markets, not just for me but also for everyone else. You should ask people if they have any compulsive behaviours or addictions like scratching, smoking and similar. And if they do, probably they're also unable to be profitable. Or maybe this only applies to me.
Anyway, today I will exercise my will power by not scratching my head or trying to. Maybe my will power is like a muscle that gets stronger by exercise.
http://www.marksdailyapple.com/increase-willpower/
http://www.dailyspark.com/blog.asp?post=3_ways_to_boost_your_will_power
http://shine.yahoo.com/channel/health/4-ways-to-strengthen-your-willpower-430670/
Some interesting quotes from the above articles, in random order:
The research says this: as much as we’d wish otherwise, we don’t have separate willpower accounts for different areas of life...
Nonetheless, researchers say, willpower is like a muscle. The more we use it, the stronger it gets. The key is to direct it well and not expect instant results. Slow and steady will give you best results in this kind of training.
As I was reading the first article, i realized yet another thing: we don't constantly need will power to do something, like brushing our teeth or not biting our fingernails. Once we've acquired the habit the need for will power is pretty much gone, or at least it keeps on decreasing the more we get used to it. The same should happen for applying those trading rules that cost me so much effort.
In this sense was the first reader's comment to the first article:
When I first started getting up at 5am to work out three years ago, yes…it was sheer willpower that got me through that first month. But, then something magical happened. I realized how much MORE energy I had during the day if I did this, and I started seeing my workouts as “me time”. For one hour each day on the weekdays, I get to focus on nothing but myself. Three years later, it’s just not even an option anymore. This is what I do and part of who I am. I’m one of the regulars at the gym at 5am, and I’m proud of it.
The second comment reminded me how many people say that athletes (and I'd add people from the military) are more prone to becoming profitable traders:
I learned long ago how to work out stressed with little willpower. I have been a competitive athlete for a long time, Div 1 in college, and coach most recently, so I never had the option to skip or take it easy during workouts. That being the case and having limited willpower like most people, i learned how to allow myself to me in the moment and let the workout melt my stress away. Workouts need to be fun and never tedious. If the workout itself is not draining you end up looking forward to it, and it becomes part of you, much like Jamie mentioned above. Good exercise, necessitates good nutrition and good sleep so for me primal living falls in line when I am able to work out for myself.
Only now I am understanding that being a profitable trader - unless you're gifted and already endowed with the needed qualities from the start - might have more to do with having an athlete's discipline than with having an intellectual's thinking. It doesn't really matter how intelligent you are, because if you don't have that discipline, you're not going to be profitable. Of course, if you're not persistent and quite intelligent, you can forget about developing an automated system. But, as a discretionary trader, you are better off being disciplined than intelligent.
Here's another comment (the third one to the first article) which is very related to trading:
Also, one needs to live in the moment. When you come to situation you just need to ask yourself, “What is more important to me right now? Eating a chocolate bar or losing fat?” Each time ask yourself what is the most important right now. I found it helps a lot.
This to me the above comment read like "what's more important to me right now? Having fun by trading or making money?"
Here's a comment related to the gym but that again applies to trading:
I’ve been going to the gym first thing in the morning for a little over a year now. I usually try to go as soon as they open, which is 7 AM. People often ask me how I manage to get up “that early” (yeah, it sounds strange to me too. 7 is early?) and that they could never will themselves to the gym that early.
In my personal experience the first month was the “hardest”. After that it became part of my weekly routine, and I found that if I simply didn’t think about it, I’d just go and do my workout of the day since it was a habit already. If I started thinking about it though, I would come up with excuses not to go. I still do this, so I make a point of writing down my workout program before bedtime or as soon as I wake up and just get dressed and go before I have a chance to reconsider.
I guess to know who's going to be a good trader and who isn't, you just ask people if they're able to go to the gym for about a whole straight year or if they just quit. Then you'll know who can be a good trader. I've never even tried going to the gym nor swimming, because I am totally unwilling to make any sacrifice and this explains why I failed at trading for 12 straight years.
Another thing he says that reminds me of trading is first of all that it will be easier after it becomes as a habit (as I had said earlier). But also that "...get dressed and go before I have a chance to reconsider", so in the sense that I shouldn't even allow the temptation to arise as to whether place a trade or not while I am in front of the screen: I should not be in front of the screen unless it's time to trade. Do not lead yourself to temptation.
Now I'm reading the second article, which is quite good, even quite entertaining for how well it's written:
http://www.dailyspark.com/blog.asp?post=3_ways_to_boost_your_will_power
...But if you asked 10 different people to define what “will power” actually is, you’d probably get quite a few different ideas.
I'd say it is "the power to make yourself do unpleasant things". Let's see what he says.
In practical terms, most of us would probably agree that what we mean by “will power” is the capacity to stick to our own good intentions, goals, and responsibilities even when we’re faced with temptations to do something else instead. But what actually gives us that capacity?
Maybe what gives us will power is just the desire to get to that objective you can only achieve by doing unpleasant things. After all will power comes from wanting to get something. It could be called "desire power", or the "power of desiring, wanting"... which is the same as "will power". If you really want something, that will give you power to do unpleasant things. I want to make money. I realize I have to do unpleasant things. And maybe now I will go through the unpleasant task of saying "no" to all my urges while trading.
Anyway, my answer to what is and what gives us will power is: will power is the power that derives from wanting something, which enables us to do something unpleasant. It comes from how much we want something. Let's now see what the article says. But first, before giving me the answer, it asks more questions:
...Is will power the same thing as motivation, or self-discipline, or focus, or determination? Does it come from inside or outside? Can you have very strong will power in some areas of your life (like getting yourself out of bed on time almost every day), but practically none in others (like resisting certain foods or staying consistent with exercise)?
And maybe most importantly, is will power something you can learn and develop over time, or is it just something you either have or don’t have courtesy of your genes?
Very good points. And here's all the answers (the title of the article is "3 ways to boost your will power"):
So far, at least, scientists who study will power haven’t done much better than the rest of us at coming up with a definition. They also haven’t located a specific area of the brain that’s responsible for resisting temptations, or any genes that make it easier or harder to resist temptation and stick to your goals.
But they do know there’s quite a bit more we can do to resist our impulses and stick to our good intentions, beyond telling ourselves to “Just Do It.” According to the research, there are three reliable and proven ways you can boost your own will power.
The Marshmallow Test
The first and most time-honored strategy for resisting temptation is, of course, distraction. As described in this NPR story, Columbia University psychologist Walter Mischel did a series of famous experiments in the 1960s, where he put hundreds of young kids in a room, one at a time by themselves, with a marshmallow on the table. He explained to each child that s/he could eat the marshmallow right away if desired, or wait until Mischel returned to the room, in which case the child would get two marshmallows instead of just the one.
The results were pretty much what you might expect. Some of the kids could barely keep the marshmallow out of their mouths for a minute, while others managed to wait as long as 20 minutes and earn the second marshmallow. What Mischel did notice, though, was that virtually all the kids who were able to resist eating the marshmallow right away used the same strategy. They did everything but pay attention to the marshmallow—they wandered around the room, kicked the furniture, twisted their hair, talked or sang songs to themselves, and so on. The other kids often tried distraction for a little while, but kept coming back to the marshmallow until they finally ate it.
Turning the “Heat” Down.
In a different variation on this same experiment, Mischel tried to see if it would matter if kids were given some additional tools they could use to resist the “lure” of the marshmallows. One big reason a marshmallow (or any other treat) is so appealing is that we start anticipating the pleasure it will give us—the taste, the texture, the smell, memories of enjoying them previously, etc. When you bundle all these things together, you have what many psychologists refer to as a “hot” cognition—a thought that moves straight to center stage of our conscious attention, and becomes pretty hard to ignore or push aside. But what if you could use your imagination or your rational mind to take some of that emotional heat away? Would that make it easier to resist the temptation?
In this version of his experiment, Mischel gave his young test subjects the suggestion that they try to see the marshmallow as a cotton ball or a puffy cloud, instead of as a marshmallow. This simple suggestion produced a large increase in the number of kids who were able to resist eating the marshmallow.
Regular readers of this blog might recognize this as a very mild and user-friendly version of aversion therapy, where you try to take things one step further by not merely cooling down your “hot cognitions” but actually making them unpleasant and unwanted, so that you’re actively motivated to avoid them. Hopefully, you won’t have to resort to that. Another way to accomplish similar results would be to become an avid food label reader or calorie counter, so that you start looking at tempting foods not in terms of their emotional or sensory appeal, but in terms of their nutritional value and whether that one minute of pleasure on the lips is worth the consequences.
Pick your battles carefully.
A third effective strategy for boosting your ability to resist temptations is to simply recognize that you can’t resist all of them. As this research suggests, our ability to constantly regulate ourselves is very limited, and the more we struggle to control what we think or feel or say or do in one area, the harder it becomes to do it in another areas. This doesn’t mean that self-regulation is impossible or that it can't be improved--just that we need to be smart and careful about how we go about it. And it probably means that the approach that is most likely to succeed in real life is one based on moderation, balance, and planning ahead to minimize problems, not one based on trying to be a superhero and do everything perfectly.
Personally, I think the idea of “will power” is not all that helpful, mainly because it’s so easy to turn it into yet another example of what’s “wrong” with us—we’re missing some fundamental ingredient that makes it possible for people to be strong and avoid temptations. Or into an excuse for not taking a serious look at what we could be doing differently. The reality usually is that we just haven’t learned the skills and mental habits it takes to handle temptations more effectively—and it’s never too late to do that.
The kid who keeps on coming back at the marshmallow until he finally eats is me with trading. I look at the charts over and over again, until I place the goddamn trade that I had resolved not to place. Clearly, the kids who waited and didn't eat the marshmallow will be the profitable traders.
More links:
http://en.wikipedia.org/wiki/Deferred_gratification
http://en.wikipedia.org/wiki/Walter_Mischel
http://www.nytimes.com/2008/04/02/opinion/02aamodt.htm?_r=2
The brain’s store of willpower is depleted when people control their thoughts, feelings or impulses, or when they modify their behavior in pursuit of goals. Psychologist Roy Baumeister and others have found that people who successfully accomplish one task requiring self-control are less persistent on a second, seemingly unrelated task.
In one pioneering study, some people were asked to eat radishes while others received freshly baked chocolate chip cookies before trying to solve an impossible puzzle. The radish-eaters abandoned the puzzle in eight minutes on average, working less than half as long as people who got cookies or those who were excused from eating radishes. Similarly, people who were asked to circle every “e” on a page of text then showed less persistence in watching a video of an unchanging table and wall.
Other activities that deplete willpower include resisting food or drink, suppressing emotional responses, restraining aggressive or sexual impulses, taking exams and trying to impress someone. Task persistence is also reduced when people are stressed or tired from exertion or lack of sleep.
http://en.wikipedia.org/wiki/Self_control#Self_control_as_a_limited_resource
Self control as a limited resource
For more details see Ego depletion
Research by Roy Baumeister and colleagues has shown that people's ability to exert self-control depends on a strength-like resource that diminishes after use.
After participants performed a task requiring self-control, they were less able to exert self-control, even in entirely different areas; this result was replicated in over a hundred experiments [12]
Conversely, research has found support that self-control can be improved through "exercising" it. For example, by maintaining proper posture, by performing everyday activities such as opening doors and brushing teeth with the less dexterous hand, and by adhering to a schedule of regular physical exercise, over time, general self-control can be improved.
There is also evidence that training people to accept the time delay before receiving a reward similarly enhances people's self-control. Donal Logue (1984) used a fading procedure in which participants were initially presented with a choice between two different rewards - a small one and a big one - which could be received after the same (large) time delay. On subsequent presentations of the two rewards, the time delay for the small reward was gradually reduced. The results showed that as the time delay for the small reward decreased, participants tended to choose the big reward more often than the small reward. Thus, Logue was able to condition participants to accept a large time delay in order to receive a big reward, rather than to choose not to wait in order to receive a small but immediate reward. Not only can people be trained to accept long time delays, but people's perception of the delay itself can be modified. For instance, Mischel and Ebbessen (1970) showed that a distracting entertaining task can lead people to perceive the time delay as shorter than they typically perceive it.
In sum, although there is empirical evidence that self-control is a limited mental resource, a number of studies support the notion that self-control is nevertheless a resource that can be increased through suitable "exercise".
The term "deferred gratification" and the concept of "limited willpower and ability of deferring gratification" show why i have so many problems with self-control lately. I have no sources of happiness (no friends, no girlfriend, no life, no sports) and I have trouble deferring the few fun things of my life: trading, eating, watching movies. That's the problem right there: since our ability to defer gratifications is limited (we can't be unhappy all day long), I should allow more fun into my life, so I will be able to disregard the fun I derive from trading. This would be a sure way to help my trading discipline. Also, by having a good life and not only focusing on trading, I'd be employing the "distraction" trick mentioned in the second article, which means not looking at the marshmallow to avoid temptations.
Ultimately, I've been trading as a source of gratification. As if I said to myself: "hey, when is my turn to be happy?". But I was wrong: my happiness should be coming from the money that trading gives me and not from trading itself. I better start using my limited willpower supply on trading alone, as i said at the beginning of this post, and on nothing else. I can't come home, tired from work, and say "finally home: now i can have some fun trading!". I've been doing it all wrong until now. The whole deferring of gratification should exactly be applied to trading by trading to make money rather than trading to have fun. Because then I'd be able to avoid any deferring of gratification in all other areas: no saving money needed and that takes care of a lot of things. Simply put: let's make sacrifices where they are most needed. Let's not save on buying new shirts and then blow the money by getting some thrills with trading. Let's rather buy the shirts and give up the fun of trading.
There's still one doubt as to all these articles and my thinking, but which I already figured out. Willpower is like a muscle they say, and it is indeed in these two aspects:
1) it can only do so much before being exhausted
2) it gets stronger the more you exercise it
So, I should exercise it but not so much that I get home and trade because that muscle is dead tired, as may have been happening until recently.
After all, this aspect of willpower being limited is quite intuitive (but it's not a taken to understand the formula as these articles explained it): if you had a very bad day at work, come home, are extremely hungry, and find your favorite cake on the table. What are you going to do? You're going to eat the whole thing. Imagine similar situations. Stuck in an elevator, hungry, someone bothers you... you're going to flip more easily than if you weren't frustrated... it all comes together. In other words, a frustrated person will trade worse than a non-frustrated person, because he's already running out of his limited will-power as he begins trading. And that has always been my case. Ultimately a person who has an unhappy life should not be doing any discretionary trading. Automated trading is an entirely different matter, but as long as you have the power to interfere with your account, there's a risk of financial disaster for an unbalanced unhappy person (like I am).
just follow the rules
