SFO Magazine Article

[thetradingdoctor]

Hi to All! I just noticed that my article "This Is Your Brain On Trading" has been published in July SFO magazine. I wrote it as a scientific discourse to get people to begin to think about their brains and the way that the brain messes with trading. People are writing to me that they have never seen or read anything like it. That's good ( I think but I am not sure!) They are also telling me it is too dry, too scientific and lacks passion.

I really meant it to be scientific and something totally different from what I usually write. Apparently, people want less science and more passion.

Here's the link: http://www.sfomag.com/homefeaturedet...ly&YearID=2007

Thanks!

Janice

[james_gsx]

I LOVE the article!

The human brain is very very interesting and it's nice to see someone put together an article like this. I could go on and on since this article makes me excited but I won't, I will say though that it makes me want to dig up some of my notes I took a while ago on the human brain.

For a long time I wanted to invest on the side and become a neurosurgeon simply because the brain is so interesting. Great article, I hope you do a follow up!

[torero]

Very interesting article, yes more scientific, but I don't see it as a negative. It's a good comparison to see how different traders make their decisions.

I do have a question. Speaking of synapses being created and strengthened every time a new experience and reinforcement of that experience is done, so when traders move from one trading system to another, these never get strong enough to be reinforced properly. But the biggest thing is the association of money and losing and winning strategy. How does one go about disassociate them and build synapses to reinforce that? Any thoughts?

[james_gsx]

Well through synapses your brain will know if it's a winning or losing trade, it's basically creating a memory. That's really what it boils down to, think of it as walking I guess. You do it over and over and eventually you learn what works and what doesn't work, so your brain focuses on doing what works (your brain wouldn't teach you how to walk where you fall down every step). Granted your trades don't work 100% of the time, but you get my drift.

I hope that's clear, it's been a while since I've read up on this but that's kind of how I see it. If I'm way off then I apologize.

You can dig very deep into this subject, and it would get very interesting. For some reason when I think of this it reminds of me the movie What the Bleep do We know (down the rabbit hole). Once I start thinking like that my mind just gets scattered and I can't possibly put it all to words in an organized fashion. But if you have seen the movie you might be able to understand why I think the two could be related.

[darthtrader]

awesome article dr. i'm going to print this out and put it on my wall:

"The average time and effort required to achieve expertise in trading is 10 years and 10,000-20,000 hours of practice. It takes much falling down, making mistakes, learning, re-learning and getting up again to make an expert trader. Most of all, it takes pure passion and total commitment to the process."

what i get from the article is that its paramount to review your trades. i would think if your not reviewing its almost blind luck if you are not only not strengthening the correct connections, but almost certainly strengthening the connections you don't want to be stronger.

[thetradingdoctor]

Thank you all so much for your comments on my article. I am thrilled that you like it and find it helpful! In reponse to the questions posed, if you learn one trading system and trade it repeatedly ( and assumedly with success) your synaptic connections will become what is called "entrained." This is a fancy way for saying that your brain learns that a certain system works and makes money. If you change systems, you must relearn and re-entrain those new pathways. In terms of making money, this is a bit more complicated because of the "old brain" pathways ( amygdala and other areas) which produce dopamine and are activated by the thought of monetary reward. If possible ( and this is not always easy) one is advised to develop a system which is backtested and shown to be profitable more than it loses. For the best traders, money is really a byproduct of trading properly. This is a concept which is not highly appreciated but is critical to understand. It is difficult to divorce the dopamine high of making money from the actual trading of the system, but it can be done and I think it is done, by and large, by experienced traders.

By the way, the article printed in SFO was only part of the original manuscript, so if anyone is interested in the full manuscript, please let me know?

Thanks Again!

Janice

[walterw]

Great great article Doc ¡¡... really very interesting and I would like to have access to the full manuscript if posible...

Here I have a question : Taking into acct all the process that it takes to the brain to get trained for succesfull trading, we can asume that if you trade several diferent setups at the same time, he obviously has a much more complex work to do... It happens to me from season to season that I trade up to 3 setups at the same time, then I feel very stressed on so much information processing and I like to come back down to one setup, making my life more easy... would you recomend really getting good on ONE setup ? and let the brain be really focused in that one strategy and not confusing him with so much overwhelming information... cheers Walter.

[thetradingdoctor]

HI Walter,

My immediate answer to your question is to try trading one setup and see how you do for one month, compared with trading three setups. Because I don't know what you trade or your success rate, I am likely speaking too generally to you and I don't mean in any way to give an off the cuff answer that would diminish your profits. However, I have coached over 600 traders and many of them do well year after year trading the same setup and doing it so well that it really is entrained. Stuff can happen, however- the market changes, program trading comes in, etc, that may force you to change this. However, if you are stressed to the extent that you appear to be during trading I do suggest you simplify and make it easier on yourself. If you don't feel good immediately about going to one system, try reducing to two and see over the month what your equity curve looks like. If you woud like a copy of the full paper, please send your e-mail address to: janice@thetradingdoctor.c om.

Thanks!
Janice

[darthtrader]

hey Doc, can you post the manuscript as a pdf on here? I'm sure a bunch of us would love to read it.

This really is one of the most inspirational things i have read, i already have your quote on my wall in front of me. I attached the graphic i made thats in front of me with that quote on it.

[walterw]

	Quote:	thetradingdoctor
	HI Walter, My immediate answer to your question is to try trading one setup and see how you do for one month, compared with trading three setups. Because I don't know what you trade or your success rate, I am likely speaking too generally to you and I don't mean in any way to give an off the cuff answer that would diminish your profits. However, I have coached over 600 traders and many of them do well year after year trading the same setup and doing it so well that it really is entrained. Stuff can happen, however- the market changes, program trading comes in, etc, that may force you to change this. However, if you are stressed to the extent that you appear to be during trading I do suggest you simplify and make it easier on yourself. If you don't feel good immediately about going to one system, try reducing to two and see over the month what your equity curve looks like. If you woud like a copy of the full paper, please send your e-mail address to: janice@thetradingdoctor.c om. Thanks! Janice

Thanks Janice for that advice.... and yes I think I am more confortable on the one setup scheme, what happens is that sometimes I get kind of curios about new methods and I love to experiment new things... now I had always been profitable on my old one unique method... so I asume that one is "entrained"... thanks for this valuable information ¡¡ cheers Walter.