Why do so few succeed?

travllr said:
Good research on our dag-blamed irrationality, here . . .

2/12/2005 (Memorable Analysis) Recent studies in behavioral finance show, in fact, investors are "often - if not always - irrational, exhibiting predictable and financially ruinous behavior," according to Andrew Lo, Harris & Harris Group Professor and director, Massachusetts Institute of Technology Laboratory for Financial Engineering in Boston.

http://www.investing-news.com/artman/publish/article_447.shtml


trav

Interesting. And while some may say "duh", there are many things we believe which are not true. Therefore, this sort of work needs to go on in order to help separate fact from fantasy.

AFAIC, this whole area -- including that of addictive behavior -- is a motherlode for behavioral research.
 
Kunal said:
The 100% cure is brutal honesty with yourself in admitting what needs to be changed and changing it...Talent, ability, luck, perseverance, and all the other BS come into play ONLY after knowhow has been acquired.
A losing system will lose money no matter who trades it.

Good post
Instead of all that 'clearing' the list stuff - why couldn't I have just said that.

zdo
 
And the point is?

Nystrom said:
The Eleventh Round
Once upon a time, in a small village in the Outback, people used to barter for all their transactions. On every market day, people walked around with chickens, eggs, hams and breads, and engaged in prolonged negotiations among themselves to exchange what they needed. At key periods of the year, like harvests or whenever someone's barn needed repairs after a big storm, people recalled the tradition of helping each other out that they had brought from the old country. They knew that if they had a problem some day, others would aid them in return.
One market day, a stranger with shiny black shoes and an elegant white hat came by and observed the whole process with a sardonic smile. When he saw one farmer running around to corral the six chickens he wanted to exchange for a big ham, he could not refrain from laughing. "Poor people" he said. "So primitive." The farmer's wife overhead him and challenged the stranger, "Do you think you can do a better job handling chickens?" "Chickens, no," responded the stranger. "But there is a much better way to eliminate all that hassle." "Oh yes, how so?" asked the woman. "See that tree there?" the stranger replied. "Well, I will go wait there for one of you to bring me one large cowhide. Then have every family come visit me. I'll explain the better way."
And so it happened. He took the cowhide, and cut perfect leather rounds in it, and put an elaborate and graceful little stamp on each round. Then he gave to each family ten rounds, and explained that each represented the value of one chicken. "Now you can trade and bargain with the rounds instead of the unwieldy chickens," he explained.
It made sense. Everyone was impressed with the man with the shiny shoes and inspiring hat.
"Oh, by the way," he added after every family had received their ten rounds, "in a year's time, I will come back and sit under the same tree. I want you each to bring me back 11 rounds. That 11th round is a token of appreciation for the technological improvement I just made possible in your lives." "But where will the 11th round come from?" asked the farmer with the six chickens. "You'll see," said the man with a reassuring smile.
Analysis
Assuming that the population and its annual production remain exactly the same during the next year, what do you think had to happen? Remember that the 11th round was never created. Therefore, bottom line, one of each 11 families will have to lose all its rounds, even if everyone managed his affairs well, in order to provide the 11th round to ten others.
So when a storm threatened the crop of one of the families, people became less generous with their time to help bring it in before disaster struck. While it was much more convenient to exchange the rounds instead of the chickens on market days, the new game also had the unintended side effect of actively discouraging the spontaneous cooperation that was traditional in the village. Instead, the new money game was generating a systemic undertow of competition among all the participants.
Commentary
This is how today's money system pits participants in the economy against each other. The story isolates the role of interest - the eleventh round - as part of the money creation process, and its impact on the participants. When the bank creates money by providing you with your $100,000 mortgage, it creates only the principal. However, it expects you to bring back $200,000 over the next twenty years or so. If you don't, you'll lose your house. Your bank does not create the interest; it sends you out into the world to battle against everyone else to bring back the second $100,000. Since all the other banks do exactly the same thing, the system requires that some participants go bankrupt in order to provide you with this additional $100,000. To put it simply, when you pay back interest on your loan, you are using someone else's principal.
In other words, the device used to create the scarcity indispensable for a bank-debt system to function involves having people compete for money that has not been created, and penalizes them with bankruptcy whenever they do not succeed. . . No wonder 'it is a tough world out there.'
In reality, we do not live in a world of zero growth population, output or money supply (as in the story). In the real world, there is typically some growth over time in all these variables...This dynamic makes it much harder than in the Eleventh Round story to notice what is actually going on. With this dynamic view, the money system is like a treadmill that requires continuous economic growth, even if the real standard of living remains stagnant. . . . This need for perpetual growth is another fact of life that we tend to take for granted in modern societies, and one that we usually do not associate with either interest or our money system

M.A. Nystrom commenting on the Future Of Money book by Bernard Lietar at
www.bullnotbull.com

And the point?

Real men trade Bonds ?? :cool:

And how does this relate to the topic?

How about – Most traders do not acknowledge that trading is a debt game and most traders do not acknowledge that they are competing against the guy in the white hat and that actually Curious George could kick their a$s all over the village if he took a notion.
 
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dbphoenix said:
... this sort of work needs to go on in order to help separate fact from fantasy.

...this whole area -- including that of addictive behavior -- is a motherlode for behavioral research.

Right - with the phrases I've been using, this whole area of behavioral finance is a motherlode for personal (uncomfortable) list ‘clearing’ of biases. To really make it traders must expand their lists of things to master and then actually ‘clear’ every item on that list. Biases, addictions, … every item on the WHOLE LIST!
 
ZDO said:
Right - with the phrases I've been using, this whole area of behavioral finance is a motherlode for personal (uncomfortable) list ‘clearing’ of biases. To really make it traders must expand their lists of things to master and then actually ‘clear’ every item on that list. Biases, addictions, … every item on the WHOLE LIST!

and even then there is no guarantee
 
dbphoenix said:
This is a far cry, however, from claiming that all of these people have warped perceptions of reality. In fact, if they retire from the field quickly, one might argue that they have a better perception of reality than those who keep throwing themselves against the wall.
:LOL:
 
ZDO said:
Right - with the phrases I've been using, this whole area of behavioral finance is a motherlode for personal (uncomfortable) list ‘clearing’ of biases. To really make it traders must expand their lists of things to master and then actually ‘clear’ every item on that list. Biases, addictions, … every item on the WHOLE LIST!
ZDO, again I can agree with you wholeheartedly. I am going to try to explain something very abstract that I find difficult to do, to find words to do it.

I think of them as turnstiles existing in virtual reality at the end of each leg of an obstacle course also in virtual reality, say.

This obstacle course is of different duration and intensity for different people.

For some it is short and sweet, for others horrid and difficult, for others very long and tedious, for others very intense and painful, and for others, sadly, an impossible mission.

The prize, is to be able to go through these turnstiles, one at a time because it is a long and tedious process, can take a long time, be very expensive, frustrating, the progressive gains are very small even and arrive in very small steps and only if they are steady,are very attention intensive, meticulous, and requires much more effort than may at first be imagined, as there is no other frame of reference to compare it with.

Once all the legs of the obstacle course are done, and each turnstile crossed, the whole list is cleared, and that is the ultimate prize.

The problem is, many of the obstacles are invisible to the individual before embarking on the process of overcoming the obstacle course, the odessey itself, even though they may be perfectly obvious to those of us who have done the whole course, gone through all the turnstiles, and now enjoy the fruits of our endeavours.

Even if all of it is explained, and it is very difficult to conceptualise and proceed to enact because much of it is abstract, it does not and cannot land until the whole odessey is experienced. So it is a chicken and egg situation.

The difficulty is that there is no way round it.

It has to be personally experienced to be understood and then it becomes part of the total expertise bank that one carries.

It is impossible to transfer it by writing about it, discussing it, showing it, demonstrating it, explaining it, recounting it, disseminating it, or trying to impart it. I used to think it could be done, now I know it can't, because the ingredients that I mention here cannot be transferred to the psyche of the aspirant.

It can only be achieved by directing the attention in the correct route, and then if the obstacle course is taken on for real and done, then yes. Otherwise, if there is a pretence that the obstacle course is being taken on for real but it is only pretending, it can never be achieved.

This is work, really hard work, much harder than is at first thought because the hindrance is the self.

This obstacle course, that exists in virtual reality (because to a large extent it is an abstract concept) does not exist for it to be played about with, toyed with, pretended or fooled around with, because if it is treated like that it turns round and bites, hard.

The benefit is that those who take it on and succeed, end up doing all the biting instead.
 
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SOCRATES said:

This obstacle course, that exists in virtual reality (because to a large extent it is an abstract concept) does not exist for it to be played about with, toyed with, pretended or fooled around with, because if it is treated like that it turns round and bites, hard.


The benefit is that those who take it on and succeed, end up doing all the biting instead.

So the market-prey :eek: has to transform himself effectively into a market-predator. :devilish:
 
superfly said:
So the market-prey :eek: has to transform himself effectively into a market-predator. :devilish:

Not necessarily. He can do quite well by becoming a hitch-hiker . ..
 
dbphoenix said:
Not necessarily. He can do quite well by becoming a hitch-hiker . ..

So somewhere along the journey, a relevant question to self might be:

Am I the predator, the hitch-hiker, the early bird or the .....type?
 
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superfly said:
So somewhere along the journey, a relevant question to self might be:

Am I the predator or the hitch-hiker type?

Yes, it would. Some people feed off this war, predator, battle, killing metaphor. Others see a flow and look for opportunities to enter that flow, exiting when the flow loses its energy.

I suspect the former scream a lot more than the latter.
 
dbphoenix said:
Yes, it would. Some people feed off this war, predator, battle, killing metaphor. Others see a flow and look for opportunities to enter that flow, exiting when the flow loses its energy.

I suspect the former scream a lot more than the latter.

I :idea: want to be a mighty sparrow type feeding of the head of the price worm.
 
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Transformation

superfly said:
So the market-prey :eek: has to transform himself effectively into a market-predator. :devilish:

No. The transformation has nothing to do with going from one to the other.
The transformation is YOU becoming big enough to 'contain' them both at a psychic level.
 
ZDO said:
No. The transformation has nothing to do with going from one to the other.
The transformation is YOU becoming big enough to 'contain' them both at a psychic level.

As long as the prey type is by far dominated by the .......type.
 
We seem to be getting into the hypothetical, philosophical, ethereal again. The balloons can't be pulled back to earth, but neither will they float away.
 
Soc,

Thank you for that contribution. You’ve made that point many times and in many ways - (… and here come the jibes :LOL: ) Most traders keep looking for tricks and shortcuts and there are NONE.

Re: “many of the obstacles are invisible” My ‘solution’ is constantly and passionately resetting the “list”. These obstacles only remain unknown only if they are never approached…

re:
” It is impossible to transfer it by writing about it, discussing it, showing it, demonstrating it, explaining it, recounting it, disseminating it, or trying to impart it. I used to think it could be done, now I know it can't.” I am agreeing with that more and more. I continue posting at all for one reason – one person. I no longer post for the many… I post for just the one trader who will look back and say “but for those posts I would have stayed in my box…” As I have asked you before, I urge you to do the same and ignore all the other stuff.

Obviously, what a bunch of posters are saying up here along these same lines (basically - that the work on the trader is equally important with work on the trading) is being heavily discounted. Maybe they will listen to Mark Douglas who says about beliefs (and remember, beliefs are just one part of the big ‘list’ ) “actively stepping into a process … of neutralizing self sabataging beliefs… just because markets represents… unlimited flow of opportunities it doesn’t mean our identities are structured in a way where we’re willing to give ourselves … wealth… these inner forces, if not reconciled… will act on your perceptions…will act on your behavior … and you will end up doing things… that cause yourself huge drawdowns. You…have to be able to recognize (these maladaptive inner processes on your list –insert by zdo)… and know how to do something about it… it requires a unique mind set … it requires an intense amount of work” This is from a guy who has coached hundreds of traders and has only met ONE in all those hundreds whose ‘list’ was nearly clear at the beginning ie who was ‘clear’ and ready to learn about how to find an edge and trade successfully… everybody is at a different place today. All I’m doing is encouraging you to move and move on levels you don’t usually consider. Most people lose because they “bring a whole plethora of issues… a huge gap… successful trader” (more Mark Douglas)

If you have time, expand on "turns and bites back" Thanks in advance.

All the best

zdo
 
dbphoenix said:
We seem to be getting into the hypothetical, philosophical, ethereal again. The balloons can't be pulled back to earth, but neither will they float away.

Most people avoid confrontations with conflicting information - it's a natural and reasonable response. I'm encouraging us to purposefully step into these confrontations (with what to you appears to be balloons). To many, no - to most, these issues are not 'balloons'

And let me get this straight - none of your information is 'balloon' ?
 
This thread is starting to become quite interesting and I’m reminded of a quote from Richard Wyckoff.

“The street is full of victims who didn’t know how, and couldn’t wait to learn”

That just about sums it up really, and long may this state of affairs continue.
 
ZDO said:
Most people avoid confrontations with conflicting information - it's a natural and reasonable response. I'm encouraging us to purposefully step into these confrontations (with what to you appears to be balloons). To many, no - to most, these issues are not 'balloons'

There's no essential conflict. I actually agree with the kernel of what Bertie said, that one learns through experience and not through reading about it. Duh. But does one have to be a gladiator bursting through turnstiles?

The problem is that the ratio of form to substance is at least 20:1, the form in this case being bloat and, yes, hot air. It's not the confrontation that's the balloon. It's the pretentiousness of the posts. If they took shape, they'd have to be nailed to the floor.
 
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