Psychology... the poll

This is a discussion on Psychology... the poll within the Psychology, Risk & Money Management forums, part of the Methods category; Originally Posted by shadowninja Indeed, some people say it's a load of bull****. I was just interested to see the ...

View Poll Results: Does psychology matter in trading?
Yes, without it, you are doomed to failure. 113 87.60%
No, it is overhyped. 16 12.40%
Voters: 129. You may not vote on this poll

Reply
 
LinkBack Thread Tools Search this Thread
Old Mar 21, 2008, 8:49am   #17
Joined Nov 2001
Quote:
Originally Posted by shadowninja View Post
Indeed, some people say it's a load of bull****. I was just interested to see the various opinions.
It isn't a lot of bull but, unless the trader is a cold fish, I don't think that there is much that can be done to make it work in one's favour, unless the person has that trading character inbred into him, in the first place. The more at risk, the more one's emotions will influence a decision. Do you believe that I, a person who started trading (as opposed to portfolio investment) at about 45 years old, can change habits of a lifetime? It's very difficult to do that because each of us has had the influence of our parents values, teachers and workmates imposed upon us for all of our most formative years.

I believe that the newcomer trader, and I am talking about people like me who started later in life, should confine themselves to one or two trades per day. Those who have started their working life in a trading atmosphere, with good teachers, may be able to manage lots more, but our psychological makeup is too biased in set ways to change easily. We may manage to be disciplined much of the time but, sooner or later, something , perhaps an unexpected news item, will make us change our minds and the decision that we take will be pure reflex, taken in a nanosecond. Afterwords, we will ask ourselves why we did that. The reason that we did it is based on the work that we have been doing in our working life.

Split
Splitlink is offline   Reply With Quote
Thanks! The following members like this post: theroguetrader , 0007 , shadowninja
Old Mar 21, 2008, 9:27am   #18
 
0007's Avatar
Joined Jun 2005
Quote:
Originally Posted by Splitlink View Post
It isn't a lot of bull but, unless the trader is a cold fish, I don't think that there is much that can be done to make it work in one's favour, unless the person has that trading character inbred into him, in the first place. The more at risk, the more one's emotions will influence a decision. Do you believe that I, a person who started trading (as opposed to portfolio investment) at about 45 years old, can change habits of a lifetime? It's very difficult to do that because each of us has had the influence of our parents values, teachers and workmates imposed upon us for all of our most formative years.

I believe that the newcomer trader, and I am talking about people like me who started later in life, should confine themselves to one or two trades per day. Those who have started their working life in a trading atmosphere, with good teachers, may be able to manage lots more, but our psychological makeup is too biased in set ways to change easily. We may manage to be disciplined much of the time but, sooner or later, something , perhaps an unexpected news item, will make us change our minds and the decision that we take will be pure reflex, taken in a nanosecond. Afterwords, we will ask ourselves why we did that. The reason that we did it is based on the work that we have been doing in our working life.

Split
I sympathise with Split's view. I do think it is possible to change previously ingrained values but it takes a lot of work & determination. In times of stress (like your trade is going down the tubes) the ever-present danger is that you will revert to type. On a parallel theme, in aviation it has been shown that training reinforces behaviour so that in the emergency or high-stress situation, the correct ie trained reaction will occur. However, as Split mentions, a lifetime's inappropriate conditioning can make it very difficult to change one's ingrained and almost reflex reaction. (This has had on occasion, disastrous results in the flying environment where a pilot has applied inappropriate procedures from a previous long-flown aircraft).

This is why it is so important to have defined your rules, practise them always and ensure you take corrective action when deviation occurs. Psychology IS important and discipline is vital. Like other people, I've learned the hard way through wallet-pain.
__________________
0007 -
"A Gentleman should not be seen before mid-morning unless he is returning home from the night before"

Last edited by 0007; Mar 21, 2008 at 9:37am.
0007 is offline   Reply With Quote
Old Mar 21, 2008, 9:55am   #19
 
0007's Avatar
Joined Jun 2005
Quote:
Originally Posted by Splitlink View Post
.........I believe that the newcomer trader, and I am talking about people like me who started later in life, should confine themselves to one or two trades per day. ........

Split
On a slightly different tack, I like the above comment. If your style of trading is compatible then it makes for a very easy, stress-free existence. Perhaps you won't make Soros's millions but it does ok for my pocket money.

On a personal level i couldn't stick in front of a screen all day long day trading. There's more to life and lots of other nice things to do - although I enjoy trading and am fascinated by it, I still see it as a means to an end - ie it gives me freedom.

I sometimes think, as an amateur trader i may not have the expertise, experience or profit potential of the professional but i have my freedom. Trade what i like, when I like, how i like. And if I don't want to go to work today, I don't. Now that's what i call freedom!
__________________
0007 -
"A Gentleman should not be seen before mid-morning unless he is returning home from the night before"
0007 is offline   Reply With Quote
Old Mar 21, 2008, 10:18am   #20
Joined Nov 2001
Quote:
Originally Posted by 0007 View Post
On a slightly different tack, I like the above comment. If your style of trading is compatible then it makes for a very easy, stress-free existence. Perhaps you won't make Soros's millions but it does ok for my pocket money.

On a personal level i couldn't stick in front of a screen all day long day trading. There's more to life and lots of other nice things to do - although I enjoy trading and am fascinated by it, I still see it as a means to an end - ie it gives me freedom.

I sometimes think, as an amateur trader i may not have the expertise, experience or profit potential of the professional but i have my freedom. Trade what i like, when I like, how i like. And if I don't want to go to work today, I don't. Now that's what i call freedom!
I feel the same as you but, perhaps, that is partly from where our lack of discipline stems. We are not taking trading as seriously as we should and it suffers as a consequence.

We have a family business. The wedding of a much loved relative is taking place in June but no one, including a son and daughter, is prepared to leave the others and go to it. If trading was in question there would be no doubt. We would all have planned to go and we'd, probably, have taken several days off.

I think that that is the attitude of many traders. It is not taken as seriously as it should be, even though quite a lot of money is involved.

Split
Splitlink is offline   Reply With Quote
Old Mar 21, 2008, 11:03am   #21
 
0007's Avatar
Joined Jun 2005
Quote:
Originally Posted by Splitlink View Post
I feel the same as you but, perhaps, that is partly from where our lack of discipline stems. We are not taking trading as seriously as we should and it suffers as a consequence.

We have a family business. The wedding of a much loved relative is taking place in June but no one, including a son and daughter, is prepared to leave the others and go to it. If trading was in question there would be no doubt. We would all have planned to go and we'd, probably, have taken several days off.

I think that that is the attitude of many traders. It is not taken as seriously as it should be, even though quite a lot of money is involved.

Split
Split,

Good points. However, I try very hard to take my trading seriously & the way i do it is to regard myself as being either on or off duty. This suits my swing style of trading and does allow me to take "days off" - we all have family duties / crises etc and, most importantly, other interests - eg Mrs 007.

And this is where I feel sorry for the professional trader. Presumably, as in most jobs where a "Boss" pays your wages you are beholden to turn up whether or not it's convenient. Those with life-responsible jobs eg doctors/pilots/HGV drivers, still have to do their work and are expected to maintain the highest standard no matter how they feel or what personal / family pressures they're under. So my attitude is: if the rest of the world has to do it, so can i when the occasion arises. I suppose it's the "can-do" attitude as opposed to the "it's all too difficult" one. I think you have to sort out what you want & where you're going as much in trading as you do in life.

I now run my trading as i did when i was in the military - I'm on/off duty and only respond out of hours in case of dire emergency. Works ok for me.
__________________
0007 -
"A Gentleman should not be seen before mid-morning unless he is returning home from the night before"
0007 is offline   Reply With Quote
Old Mar 22, 2008, 8:35am   #22
Joined Nov 2001
http://www.trade2win.com/boards/gene...tml#post405562

I thought that this post by nine, in his "useful things I've found on the net" thread fitted in very well with this debate.

Split
Splitlink is offline   Reply With Quote
Old Mar 22, 2008, 10:21am   #23
Joined Feb 2007
Psychology is overhyped. People love the word psychology, especially on chat forums, especially newbies to trading.

Why?

Because psychology is supposed to hold the answers to their shortfalls and mistakes....'crack my psychology and the money will roll in'...he he he.

Rubbish.

Concentration and screen time is what you need. I even think the word 'discipline' is a slightly misused and misunderstood word.

Anyway, the soup kitchen is closing now, ta ta.
Paul71 is offline   Reply With Quote
Old Mar 22, 2008, 10:45am   #24
 
rog1111's Avatar
Joined Jan 2004
The question is "Does psychology have a strong influence on your success or failure in trading?"

Yes, on the basis that your thoughts become reality (and not just in trading).

rog1111
__________________
He who knows much about others may be learned, but he who understands himself is more intelligent. He who controls others may be powerful, but he who has mastered himself is mightier still. Lao Tse
rog1111 is offline   Reply With Quote
Reply

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Similar Threads
Thread Thread Starter Forum Replies Last Post
Poll Suggestions Sharky T2W Feedback & Announcements 16 Apr 18, 2004 8:34pm

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)