Err... Psychology and Trading?

trader111 · #1 19th July 2008, 01:41 PM

I have always had an idea that psychology stuff is for dizzy eyed professors who look at you through their thick glasses. While traders are a awefully smart breed who drive a Porsche (ok in India I will settle for Honda Civic) and can buy 20k shares faster than you blink.

Few authors do reciprocate my way of thinking

Quote:

The notion that trading is mostly mental/psychological is complete rubbish. A negative frame of mind can interfere with the best of skills and experience, but a positive frame of mind won't provide you with the pattern recognition skills and the conceptual integration to make the above trade. The way you learn short-term trading is by seeing one example of a pattern, after another, after another, after another.

Streenbarger said it, he is quite a known author. But I dunno why after saying that he himself ventured into writing more about psychology stuff that anyone else

Ok, I understand he is a blogger, needs the crowd to visit regularly his website

Wait... m not gonna bash psychology stuff in the Trading Psychology forum. So sharing here the only material on psychology which I really found worthy of reading. The strategy mentioned in Scalper's Forum is much derived from the book (sure it needs additions for pro scalpers

)

Quote:

The "Phantom of the Pits" is a legend in the markets, but he also remains an enigma. Back in the mid 1990s he recorded a series of interviews which have since been published. This 'book' has now gone down in trading folklore as one of the most though provoking and significant ever...

Here too I did not benefit from the whole thing but mostly from the following chapters:
4. Preparation for Trading
5. Rule One
6. Part Two
7. Trading with Rules One and Two
13. Behavior Modification
The Third Rule

The book is freely available on many websites on the internet because there are no copyright issues. Ok a link for someone who is lazy to google: http://www.mypivots.com/articles/boo...f%20the%20Pits

Looking forward to discuss with people who follow Phantom Of The Pits.

PS: I also like Livermore's say on the subject found in tidbits his two books.

trader111 · #2 21st July 2008, 10:56 PM

There has been some talk about POP before: http://www.traderji.com/words-wisdom...tml#post145663

looks like people not much interested in it.

trader111 · #3 26th July 2008, 05:00 AM

Regret

People regret decisions which turn out to be wrong ex post.
Regret is particularly large:
• …if it is one’s own fault.
• …if the decision was extraordinary.
Hence people avoid decisions which may cause regret.

Example:
• Imitation (trading on tips, rumors)
• Losses are not realized. (holding loosing positions)
• Only dividends are consumed, to avoid having to liquidate assets.

oilman5 · #4 27th July 2008, 01:37 AM

a great thread ............from a budding trader!!!

musicjunkie · #5 27th August 2008, 05:46 PM

I really , really enjoyed reading POP, still going through it...will discuss if anything pops up...
Rule two....mmmm...familiar isn't it ?

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