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10,000 hours to greatness and the Mastery Asymptote

  • #101
  • Mar 18, 2017 7:49pm Mar 18, 2017 7:49pm
Quoting Rufus
I have been thinking lately about routines as they relate to trading and life. https://www.youtube.com/watch?v=SoqanZJkwxU Baseball is loaded with routines, some bazar others simple. I can't think of a single Major league player that varies his routine at all. The point of it is consistency and to prepare them mentally for each pitch. Baseball is 90 per cent mental. The other half is physical Yogi Berra Trading is probably about the same. So how important would a routine be in trading? I think it is. I know some traders that meditate...
We are certainly creatures who like routines and habits!.

I've been observing my own mind for quite a while now and realized we have 2 minds, a mind that's a bit like a default safety software that's always operating, talking rubbish to us and that keeps us alive and out of trouble. The second mind is the one that put's us in the zone so to speak, it's been described often as our 'conscious 'mind. Most people don't seem to be aware of the conscious mind and always seem to operate in default mind I find myself straying into default mind and have to pull myself back often. It's a skill that has to be intentionally developed. To be a successful trader this conscious mind has to be accessed and used and I truly believe this is one of the main reasons traders fail.
Never said I was Batman,all I'm saying is you'll never see us together.
  • #102
  • Mar 19, 2017 3:47pm Mar 19, 2017 3:47pm
Quoting headfake
{quote} We are certainly creatures who like routines and habits!. I've been observing my own mind for quite a while now and realized we have 2 minds, a mind that's a bit like a default safety software that's always operating, talking rubbish to us and that keeps us alive and out of trouble. The second mind is the one that put's us in the zone so to speak, it's been described often as our 'conscious 'mind. Most people don't seem to be aware of the conscious mind and always seem to operate in default mind I find myself straying into default mind and...

You might enjoy the book. "Thinking Fast and Slow" by Daniel Kahneman
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In the book he divides the mind up in two modes of thinking. System One and System Two .

From the book...

System 1... operates automatically and quickly, with little or no effort and no sense of voluntary control.

System 2... allocates attention to the effortful mental activities that demand it, including complex computations. The operations of System 2 are often associated with the subjective experience of agency, choice, and concentration.

It's definitely not a book you sit down and read in an evening. I will be reading it a few times. It's loaded.

The two systems are a wonderful concept to understand how this mind of ours works. For instance... If you and I were on a very fast walk, not a leisurely stroll, and I ask you a long division problem, your pace would slow down. System 2 is taking over the computations and taking away from the mental effort that is required to "Power Walk"

Or if you are driving on a freeway with no problems in sight you and I can have a conversation and be quite in depth. System 1 is involved with the experienced driver. If all the sudden we encounter unsafe situations your system 2 will take over and our involved conversation would temporarily end until system one can resume control of the driving.

Our minds are remarkable. Trading has sure helped me understand more about mine.
Illegitimi non carborundum - Noli pati a scelestis opprimi.
  • #103
  • Mar 19, 2017 8:58pm Mar 19, 2017 8:58pm
To add to what you are saying, I think the problem to success is bad habits. When you start trading you are flushed with a lot of garbage from people who know absolutely nothing about trading. People who couldn't make a dime in the markets and are recouping their losses on the lambs. I think it is easier for someone who knows nothing about trading to be thought the game than many of the failed trader. The longer you persist and re-enforce those bad habits the harder they are to change. To my point of view people fail because they are trained by failures to fail. Once you get into the wrong mindset, its difficult to change your rhythm. Think about the last time you realized that you were breathing?

When I started trading I turned a 10 000$ account into 60 000$,will buy a stock and if it went up I will keep it until I was satisfied with my profits and if in a loss I will sell it when I felt it was a bad investment. I had no reason to place those trades, I was basically clueless of any form of fundamental or technical analysis. Then I got bored and wanted to be more involved and in control. Started learning a lot of mumbo jumbo, It messed my mind up folks. It took me 4 years to find my natural rhythm back, I wanted action and action I got. Blowing several accounts in the process.At least what I learned is that my goal in life should not be only to make money, but the process should be satisfying and fulfilling.
Special one
  • #104
  • Mar 20, 2017 2:05am Mar 20, 2017 2:05am
Quoting Rufus
{quote} You might enjoy the book. "Thinking Fast and Slow" by Daniel Kahneman {image} In the book he divides the mind up in two modes of thinking. System One and System Two . From the book... System 1... operates automatically and quickly, with little or no effort and no sense of voluntary control. System 2... allocates attention to the effortful mental activities that demand it, including complex computations. The operations of System 2 are often associated with the subjective experience of agency, choice, and concentration. It's definitely not...
Interesting i'll check it out cheers.

Our mind as a trader is our best asset AND worst enemy. I think most traders are stuck in and never get passed the ego stage. Once past the ego stage then you open yourself to knowledge. The next tricky bit is to obtain knowledge and put it into action but then you come across your self destructive tendencies that need to be removed. Once you've removed those and can keep your ego in check (knowledge searching) trading tends to improve quickly.....
Never said I was Batman,all I'm saying is you'll never see us together.
  • #105
  • Mar 25, 2017 1:10am Mar 25, 2017 1:10am
I have been mulling over starting a trading Blog. I'm sure there are some here that have done or continue to do this, but I would like some thoughts on it. Not looking to make it a thing to profit from, just a place to journal in detail my trading life.

I have tried a number of ways to journal, not happy with them. Notebooks have been my preferred method. But searching through these are impossible. Then trying different methods of attaching screen shots have been futile.

So how about some thoughts on how you journal. I'm sure there are others in FF land that would love to hear your ideas.

Rufus
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  • #106
  • Apr 15, 2017 9:03am Apr 15, 2017 9:03am
I sometimes think that speculation must be an unnatural sort of business, because I find that the average speculator has arrayed against him his own nature. The weaknesses that all men are prone to are fatal to success in speculation

The speculators chief enemies are always boring from within. It is inseparable from human nature to hope and to fear. In speculation when the market goes against you, you hope that every day will be the last day and you lose more than you should had you not listened to hope to the same ally that is so potent a success-bringer to empire builders and pioneers, big and little.

And when the market goes your way you become fearful that the next day will take away your profit, and you get out-too soon.

Fear keeps you from making as much money as you ought to. The successful trader has to fight these two deep-seated instincts. He has to reverse what you might call his natural impulses. Instead of hoping he must fear; instead of fearing he must hope. He must fear that his loss may develop into a much bigger loss, and hope that his profit may become a big profit. It is absolutely wrong to gamble in stocks the way the average man does.

Jesse Livermore
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  • #107
  • Apr 23, 2017 1:30am Apr 23, 2017 1:30am
“I think 99 times and find nothing. I stop thinking, swim in silence, and the truth comes to me.”


Albert Einstein
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  • #108
  • Jan 20, 2018 4:13pm Jan 20, 2018 4:13pm
I have been thinking about edges and exploiting them lately and my thoughts brought me to this thread.

The start of this thread was with the mastery asymptote.

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Now some thoughts that will be elaborated on later.

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  • #109
  • Jan 23, 2018 11:46pm Jan 23, 2018 11:46pm
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I was thinking today about the importance of guarding your mind.

There is an individual that works for me who often visits a psychologist for various things, one of which is controlling his anger. I have never had a problem with him but there are others who used to work for me who "pushed his buttons" and would cause this anger to reach a rage. But what I see is that he feeds this anger. Music he listens to, online games that he becomes emotionally invested in, or things on various social media just to name a few.

We as traders do the same.

Are we impulsive in our trading? Are you an impulse buyer in the grocery store?
There are many habits in life that carry right over to our trading.
Illegitimi non carborundum - Noli pati a scelestis opprimi.
  • #110
  • Jan 28, 2018 5:53pm Jan 28, 2018 5:53pm
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One of my favorite tee shirts.

As traders we live in the realm of incomplete data. We will never have all understanding for a position nor can we guarantee the results of each position. But live in and be content with what data our chart may show us.

One of my favorite topics now is heuristics in decision making. This has been intriguing since reading a couple books.

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And

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If you get the urge to read these; I'd start with The Undoing Project. This book lays out how these two men met and their lives and touches a bit on their research. Thinking Fast And Slow goes into incredible detail.

Heuristic ....A heuristic technique, often called simply a heuristic, is any approach to problem solving, learning, or discovery that employs a practical method not guaranteed to be optimal or perfect, but sufficient for the immediate goals

I will be studying various types of heuristics as they relate to trading decisions. Hopefully have the time to share them here.

Some that may hinder a good decision are.

 

  1. Availability.
  2. Representativeness.
  3. Anchoring and adjustment.
  4. Affect heuristic.
  5. Others.
  6. Cognitive laziness.
  7. Attribute substitution.
  8. Fast and frugal

Just to list a few

We will see how this goes.

Rufus

Illegitimi non carborundum - Noli pati a scelestis opprimi.
  • #111
  • Feb 1, 2018 8:39pm Feb 1, 2018 8:39pm
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Just finished this book today. Incredible.

Any review I write would fall short of what is contained in these pages. Reading it from a traders perspective is especially worth while.
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  • #112
  • Feb 2, 2018 9:17pm Feb 2, 2018 9:17pm
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Great things tend to start small. Persistence is required.
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  • #113
  • Feb 3, 2018 11:16am Feb 3, 2018 11:16am
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I have been thinking about the above book.

One thing I realized while reading was how much I enjoyed my time at a university. There were a few friends that I spent a lot of time with and we would get into all kinds of deep discussions about all topics. Nowadays it is seldom a conversation like this develops. The guys that work for me are more interested in Tibia, girls, or just plain drama. My wife and I will get into the occasional interesting conversation, just not the depth I crave. But there is also a trader who used to post here in FF a lot where one or two Skype calls a year will result in a good brain exercise.

This wonderful book was first about an incredible friendship between two incredible individuals with practical deep thinking minds. The result of their time together has altered a lot around us today. Also set the stage for Behavioral Economics. Daniel Kahneman a psychologist received the Nobel Peace Prize in Economics in 2002. Richard Thaler an economist received the Nobel Peace Prize in 2017 for his work in Behavioral Economics. Thayler was deeply influenced by Daniel Kahneman and Daniel's friend Amos Tversky. If Amos had been alive in 2002, he probably would have shared the Nobel Prize with Daniel.

My deep thinking now is usually confined to my own skull. So if you are fortunate enough to have a friend that shares their depth of understanding and stimulates your mind to deeper thoughts; cherish it, it is of great value to you and all those around you.
Illegitimi non carborundum - Noli pati a scelestis opprimi.
  • #114
  • Feb 3, 2018 8:03pm Feb 3, 2018 8:03pm
Quoting simpleguy
... What is a Master of the FX markets? ...
A “master” is the one who understands duality ...
S/He acknowledges that either side can happen at any moment and plans to anticipate both sides ...
Market is not random but unpredictable
  • #115
  • Feb 4, 2018 4:10pm Feb 4, 2018 4:10pm
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This came across my FB.

I am not promoting one party or another. But look at how our sound thinking can be swayed by the winds of the media.

Our trading is affected by the same winds if we don't filter what we read, see and hear. Noise no matter how subtle , is still noise.
Illegitimi non carborundum - Noli pati a scelestis opprimi.
  • #116
  • Feb 4, 2018 7:30pm Feb 4, 2018 7:30pm
Quoting Rufus
... Noise no matter how subtle , is still noise ...
I’m not promoting not to trade fundamentally, but IMHO, trading technically, especially in this volatile forex market, is the way to go because those “noises” will be absorbed fast in price action ...

Fundamental analysis might be useful to indicate future trend, yet that trend will be clearly reflected on the chart once it starts moving ...
Market is not random but unpredictable
  • #117
  • Feb 6, 2018 9:49pm Feb 6, 2018 9:49pm
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Stoic Philosophy suits me
Illegitimi non carborundum - Noli pati a scelestis opprimi.
  • #118
  • Feb 7, 2018 5:38am Feb 7, 2018 5:38am
Very interesting topic, I'll be following for sure and hope I can contribute something.

I think the single most important thing in helping overcome psychological issues related to trading, especially before you have developed a sound intuition, is journalling and collecting data and statistics. When your decisions are based on past data and numbers a failed trade or an early exit lose it's meaning.

For those interested a free course on statistics and probabilities I plan on following when I have some time.
https://www.khanacademy.org/math/statistics-probability

Cheers,

Giacomo

And stoicism helps a lot. Reflecting on death makes losing a trade seems a lot more insignificant.
  • #119
  • Feb 7, 2018 6:54am Feb 7, 2018 6:54am
Quoting TrendRider86
Very interesting topic, I'll be following for sure and hope I can contribute something. I think the single most important thing in helping overcome psychological issues related to trading, especially before you have developed a sound intuition, is journalling and collecting data and statistics. When your decisions are based on past data and numbers a failed trade or an early exit lose it's meaning. For those interested a free course on statistics and probabilities I plan on following when I have some time. https://www.khanacademy.org/math/statistics-probability...

Hey... Thanks for the Link, I will put that on the first post.

I will be doing the course as well. Hopefully sooner than latter.
Illegitimi non carborundum - Noli pati a scelestis opprimi.
  • #120
  • Feb 7, 2018 7:55pm Feb 7, 2018 7:55pm
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Jeff Bezos started Amazon in 1994 running the business with his parents life savings.

The story goes... Jeff was looking at desks for his handful of employees and saw how expensive they were. There was a Home Depot across the street so to save money built desks out of a door and four chunks of wood for legs. Supposedly he still uses a modified version of it today as a token reminder about the importance of pinching pennies.

Bezos even uses the desk as a symbol to recognize employees who come up with cost-saving ideas at Amazon'sall-hands meetings, by presenting them with a miniature desk that he's signed, called the "Door Desk Award." Most recently, the award went to three employees who had an idea to use gift bags instead of gift wrap for presents, saving Amazon millions of dollars.

Spending money on frivolous things that have nothing to do with your business model to me is such a waste. Like buying tee shirts, or pencils, coffee cups with your logo when you are a construction company. Sure the fluff may be nice once in awhile but all in all stick to the plan.

Our trading can get hung up with many of the same pitfalls. Wanting all the fluff. When it comes down to it, it is just you and your chart. Jessie Livermore traded with less.

Again. Many great companies had very humble beginnings. I am siting at my nice quiet desk with my little dog in my lap. Two years from now I'll still be at this desk with a dog in my lap, but may be managing millions for other people. Who knows....



If you want to build your own Amazon Door Desk...

What you need to get started

- a solid-core door for the desktop

- four 4x4s to use as legs

- braces to connect the legs to the desktop

- screws

Rufus

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