[Dogpile]

This is a highly interesting topic and subject of recent books.

To me, it is clear that program trading can dominate at times. If you do not remain flexible, you will get run over by these competing algorithms that are written by extremely smart people trying to take your money.

But there is a good argument to be made that all these competing algorithms actually make 'right-brain' synthesis of complex, dynamic information MORE important. If so much money has so much compute power running mathematical programs, then the market is saturated with 'left-brain' compute-intensive strategies.

From Daltons latest newsletter (May 2007);

Successful trading is for those individuals that can continually combine the left and right hemispheres of the brain to appreciate what is occurring in the markets.

From our bookshelf:

During our trip to Chicago last month, Jim and I were introduced to a book containing a significant amount of thought provoking information. Our thanks go to Linda Raschke who introducing it to us as a 'must read'. The book, 'A Whole New Mind' by Daniel Pink, focuses on the power of whole brain thinking and how the right-brain will play an important role in the future in ones success. Chapter 6, "Symphony", provides insight to Pink's thinking.


Chapter 6 - Symphony - In this chapter Pink demonstrates how there is far more than just focusing on the identifiable, mostly left hemisphere, facts. He discusses the importance of invention and conceptual big picture thinking.

If we were to relate Pink's chapter entitled "Symphony'; to trading we might experience:


The ability to create something new and / or different such as a new type of chart, or a way to display or interpret volume, or understand a new shape nuance in the Market Profile graphic.

The ability to create meaningful pre-session and post session narratives to better prepare yourself for the following trading session. (DLC's next educa-tional letter will expand on the narrative idea.)

The ability to synthesize, combine or correlate unrelated ideas or parts into something unique and beneficial such as synthesizing the relationships between different markets and understanding how the markets different timeframes, coexist, interact and merge.

The ability to observe, interpret and understand the subtleties and nuances of human behavior as reflected in the markets order flow by understanding inventory balances and imbalances.


Today, as you know, we live in the age of information overload. Facts are at our fingertips via search engines, the media, and dial-up information services actually make information less valuable while making its relevance, interpretation and understanding more valuable. In other words, it is our ability to think with our whole brain - not just left or right, that will separate us from our competition. It is this focus that makes this book a 'must read'.

This book challenges the reader to go beyond their conventional and structured ways of thinking that were developed by both upbringing and environment. In many ways it is in the same category as Malcolm Gladwell's 'Tipping Point' and 'Blink' in respects to looking at how we look and think about things. "