Mark Douglas or Brett Steenbarger Which one did you find most helpful for the psychological aspects your real world trading. Please no subjective opinions I'm just looking for measurable results (with trading issues) after reading them. If you found another book that you found useful please comment.
Joab, You possibly need to split Steenbarger based on which of the two books people have read. The second is far different from the first (unlike Douglas's two where the second is in most essentials a rehash of the first). FWIW, IMO Douglas, particularly in the disciplined trader (and much more succinctly in the TASC review of him) gives the best analysis of "what goes wrong" for a trader that I've seen. His breakdown into a set of discussable fears and their roots is excellent. What he lacks is too much help on "how to fix it." He has a strategy that might or might not work for people depending on what their history and learning styles are - I suspect thats the biggest reason for the divergence of opinions on him. Steenbarger's first book discusses trading problems in terms of overall problem patterns for people and suggests ways of dealing with them that again may be successful or not depending on the person (many may need support to apply them). His second book is much more focussed on training but in the latter part deals with some behavioural and some cognitive strategies for dealing with them. In this book he much more clearly defines common issues that traders face - most will be able to see elements of themselves in the traders. Steenbarger's books, coming from a student of the markets, psychology and modern research in how our brains really work, offer a more up to date realistic view of trader training and repair of the damage that traders do in learning. Both authors can be a bit boring (a bit I hear some say!) but both are, IMO, worth reading.
Kiwi, Thank you for the reviews, much appreciated. The problem that I've have with psychologists is they usually offer few solutions to the problems traders face and real workable solutions. Explanations are really useless in my opinion. How to deal with emotional control and idomoter reactions is what I am specifically searching for. Maybe I will try and write a 12 step program.
Douglas, in Trading in the Zone, does much more than simply talk the problem to death. He does that of course, but then gives you specific things to COMMIT to yourself that if you were to truly believe the idea of probability, then you will no longer be at odds with your brain. And then trading becomes a method of execution, rather than stress. Excellent book. Highly highly recommended.
I also endorse both Douglas and Steenbarger, because they emphasize different areas of development. Mark is big on self understanding and the power/influence on beliefs on a trader's ability to execute flawlessly. Dr Brett is big on approaching trading as a peak performance sport and hence focuses most of his time/energy on strategy/tactics. In his latest book, the majority of the chapters are devoted to enhancing performance via strategy/tactics and the last few (not that they are unimportant) are about cognitive self help. Now, if Dr Brett and Mark did NOT trade, I would not offer the following constructive criticism. But since they do, I will go ahead with it: They both acknowledge that you need a demonstrable edge to trade. They have both stated that in online seminars, classes, blogs etc. However what they have NOT done is told you how to KNOW beyond reasonable doubt that you have an edge. And that requires going into statistics and hypothesis testing. This is where it gets interesting. The only way you can have unshakeable confidence (the kind that lets you recover from a 30-40% drawdown for example) without changing trading methods is by knowing the numbers/stats on your system/s cold with constant monitoring for possible deterioration in them. For you to BELIEVE, really believe that the next trade has a random outcome and that you don't need to know it's outcome to be profitable over a sample of trades, you need to KNOW that you have an EDGE. I would go as far to say that the helpfulness of these 2 trading coaches is either 0 or 100%, depending on whether the trader reading them knows whether he has an edge or not. If he does not have an edge, then no amount of reading these 2 will help, and hence usefulness will be a big zero. If he does have an edge, then their usefulness catapults to 100% or even more, because they reinforce all the necessary steps to flawless execution. It follows that if you don't know whether you have a statistical edge, you should not be surprised if your performance is marred by a host of 'psychological' problems. Those are your body/subconscious mind's way of trying to tell you the truth: that you're not ready to trade yet. If he puts another book out, I hope Mark Douglas addresses this issue. But since he is trading for himself and probably doing very well, I doubt he will. Dr Brett on the other hand will probably look into this. Hope this helps
Maverick, Brilliant post and I could not agree with you more. I know for me it was only massive amounts of screen time and seeing set up after set up unfold that I was able to gain confidence. There in lies the reason why it takes the average trader 5 years to develope fully. That being said I still make small errors everyday and I know I'm only working on 80% of my potential. I'm looking for some mental exercises (if you will) that are specific to execution and correction of small errors. Which of the two do you think would be the better read for this.?
I'll answer too. Douglas 'Trading in the Zone' has these exact exercises and sayings to assist you. That said, read both books. It's not an either/or. They are both excellent.
If you are absolutely sure that you have a statistically significant edge, then I would recommend Douglas. If you're not sure, then I would recommend reading Dr Brett so that you can at least start to fathom what it takes in terms of reorienting/learning until you can acquire an edge.
agreed. most psychological problems come from fact that one seems to be able to fool the rational facility more easily than the core emotional reactions.. It is not shocking that most feel emotionally what they will not admit cognitively: that they don't have much of a prayer if that of success, consequently they feel plagued with emotional issues.