Great post, thank you. Don't overlook the value of discipline. My personal efforts in all areas of my life have experienced a significant surge in success, without any supplements ...while simultaneously depriving my brain of the nutrients and energy it would have if I wasn't currently dieting
So I read a trading book recently... It seems these days I'm inclined to see the glass 'half full' with pretty much anything, if i have to take 12 hours to read something and there's the smallest nugget of information that could 'potentially' increase my performance by 0.5% then I'm incredibly excited by that prospect. The book I read (and have been continuing to re-read) has been 'Trade Mindfully' by Gary Dayton. Forget 0.5%, this book had a complete paradigm shifting 'change my life' source of value. I'd like to go through my interpretations, chapter by chapter. Entirely because I want to completely study this book and this is probably the best way to fully internalize it, hopefully going back and forth with traders who have been on the journey and can offer different perspectives from their own paths. So here goes.. Chapter 1 Traders’ Mental Blind Spots This chapter for me highlighted the behavioral economics I studied whilst at university, but applied it to trading. It's an application of Kahneman and Tverskys (nobel prize winners) 'Thinking fast and slow' to trading. What Dayton really highlighted in my mind was that more than just 'emotions' in trading the way we're biologically wired to think has far more of on impact on our trading. Part of our 'genes' our 'evolution'... whatever 'that is'... means that we like to take shortcuts, 'heuristics'. Take for example going out for a restaurant meal, we could extensively study the menu, look at multiple reviews online, have a friend who's dined there before or know the chef.... or we could simply take a peek in the restaurant, see the ambiance, see how busy it is and quickly look at the menu. If we took the first option we would have a more reliable source of information... but that takes work, and time. The second option involves a quick 'intuitive' glance, in most cases in our day to day life this is entirely satisfactory and we arrive at our decision quickly. However Kahneman and Tversky proved that these particular 'shortcut', 'intuitive' decisions were massively fraught with errors when under conditions of uncertainty and risk. Exactly the conditions traders experience day in and day out. Dayton highlights several of these heuristics that are most applicable to trading, I wont go into any detail as I'd basically be re-writing the chapter. If you think emotions are the only hurdles to trading then you're sorely mistaken. ■ The representativeness heuristic ■ The recency effect ■ Loss aversion ■ Confirmation bias ■ Base rate neglect ■ The affect heuristic ■ Hindsight bias ■ The endowment effect ■ Optimism bias Anyone reading this without prior knowledge, these are just random names and classifications. I won't explain them, this is more of a nudge to do your own research. What I will say is that these are all examples applicable to trading that use the intuitive 'shortcut' part of your brain (the second option in the restaurant example). These are not emotions, its just the way our brains work through evolution. Dayton asked the readers a couple of questions in this chapter and I'll copy them here. 1. A bat and a ball cost $1.10 in total. The bat costs $1.00 more than the ball. How much does the ball cost? _____ cents 2. If it takes 5 machines to make 5 widgets in 5 minutes, how long would it take 100 machines to make 100 widgets? _____ minutes --- I'm really not going to give Dayton justice in how he elegantly explains the problem and goads you into figuring out a couple of realizations about your thinking process, I'll provide answers in the next paragraph (don't cheat!). He basically splits our minds into 2. The intuitive mind, which is like the second example in the restaurant, the mind that uses shortcuts and heuristics; and the deliberative mind, which is slower and thinks through the answers before coming to a conclusion. Even if you managed to answer the above questions accurately, he's willing to bet that you first thought about the 'intuitive answers' first. Initial 'Intuitive' answers 1. 10c 2. 100 minutes Deliberative/correct answers 1. 5 c 2. 5 minutes So there it is, emotions aren't the main killer of traders, it's literally the way our brains function. If you had any trouble in answering those questions (you should have, they were on the surface easy but pretty tough) then imagine what it's like under conditions of risk and uncertainty, fleeting probabilities, abstract edges... it's tough, these heuristics come into play all the time, they have nothing to do with emotion, just the way we've biologically adapted as a species. --- I talked about trying to find value in everything earlier, my actual path to find this book began with this forum conversation. http://www.elitetrader.com/et/index.php?threads/85-of-retail-traders-short-s-p.298901/page-2 Q3D mentioned something about Al Brooks and as someone who's benefited greatly from studying what he teaches I thought I'd respond with something. Long story short, our conversation pushed me to look at other forums discussing 'Al Brooks' and I found a few recommendations of other books, Trade mindfully being one of them. ----- My arguments in that conversation really primed me for the insights I gained reading the Dayton book. I now realize that before Al Brooks I was just reading trading books intuitively. 'This chart pattern makes sense', 'this author writes well', I never stopped to truly think about what I was reading. A huge step in my growth was actually seriously taking the time to read Al Brooks' nonsense books. Thinking about it now with Dayton's book, I had to pull my deliberative mind out in full force just to 'understand' Brooks, the way I trade along with many of my own anecdotal forum experiences with other traders is very different to Brooks. I can't help but think that through reading his materials, we learned a few trading gambits, sure, but more importantly we learned how to engage our deliberative minds. I hope you can see how powerful this book was for me on just the first chapter. This may take me a few months to get through but I'll be going through each chapter and how it personally relates to me. I would highly recommend purchasing the book, from my perspective anyway. Chapter 2 .... awaits
Don't underestimate the value of a disciplined man working to his full biological potential. I've been through some self inflicted hardcore discipline 'challenges' the last few years so I know where you're coming from. From a science perspective however, most adult males are deficient, nutritionally in several areas. Choline being one of them, from the most 'extreme' study up to 90% of adults are deficient. Sure discipline is good, but given you have it, what else are you missing that can easily be corrected with a couple of supplements? That was my view anyway
Hi Wingz,are you still trading energy? I've read your thread recently and found it very interesting but had some doubts about hose 6-1 and the non-usual permutations (per usual I refer for regular flies or regular 1-3 combos)