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Key Ingredients to Performing Your Best

  
  Education
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1.  Passion. You must be passionate about what you re doing and having fun. Passion first, then performance.
2.  Confidence. Top performance comes from having a high degree of confidence. You must have the confidence that you can take control and face adversity. You must also be confident that you will have a favorable outcome over time.

 3.  Concentration. Peak performance comes from exceptional  CONCENTRATION. You must concentrate on the process, though, not the outcome A sprinter who is in the lead is thinking about the wind on their face, how relaxed their arms are, feeling the perfect stride…they are totally in the moment. The person who does NOT have the edge is thinking, “Oh, that runner is pulling ahead of me…I don’t know if I have enough wind to catch the leader…” They are tense and tight because they are thinking about the outcome, not the
process.

4.  Resiliency. Great performances come from being able to rebound quickly and forget about mistakes.
5.  Challenge. Great performance comes from pushing yourself and trying to overcome limitations. Staying in the safe zone becomes a monkey on your back. Challenge yourself to take that hard trade. Manage it. If it does not work out, so what…your risk was limited and you can pat yourself on the back for taking the hard trade in the first place.
6.  See and DO … don’t think! Great performance comes from turning off the brain
and becoming automatic. This is being in the Zone …in the groove. You can’t overanalyze the markets during the trading day.
7.  Relaxation. When you are relaxed, your reflexes and timing are superior because
you are loose.

No More Fingers! 'Brainprints' to Be the Passwords of the Future

  
Analysis, Education
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BrainPeople can be accurately identified by their unique brain wave pattern, a new study has revealed.

A team at Binghamton University found that each of us has a personal “brainprint” that can be detected with particular techniques. In an experiment reported in the journal IEEE Transactions on Information Forensics and Security, the researchers, led by Dr Sarah Laszlo, explained how they selected 50 volunteers and showed them various images. 

These included photos of “a slice of pizza, a boat, Anne Hathaway, [and] the word ‘conundrum,’ ” the paper explains. As each subject looked at the images, an electroencephalogram (EEG) machine was picking up the way their brain behaved. 

The scientists found that each participant’s brain reacted in a different and specific way to the images shown. Building on that, the researchers managed to developed an algorithm which was able to match every person with their “brainprint” with high accuracy.

According to Laszlo and her colleagues, “brainprints” could become the passwords of the future. One could first be plugged to the EEG machine to record his or her particular “brainprint” as they look at some specific image, effectively setting a “brain pin code.” Then, every time that person sees that given image again, another EEG machine would cross-reference its brainwaves with a vast database to confirm their identity beyond any doubt. (more…)

Why do only 5% of the traders who day-trade end up successful?

  
  Education
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5percentTwo reasons – #1) Many just want an indicator that is going to reveal the market to them and it is too competitive for that to work.

#2) The vast majority don’t approach the challenge in a way that will work. To a large degree, this isn’t the trader’s fault because most do what they have been taught by scores of “experts”.

Here is what will work. Guaranteed.

1. Never forget that the only thing you want to do is predict that others will buy higher or sell lower in your timeframe.

2. Settle on a strategy (and set of tactics) that suits your personality and thinking patterns.

3. Plan to use your judgment in the midst of making decision and entering trades! You are not a robot and you will never become one. Your brain is going to kick-in with its built-in facility for decision making in uncertain situations. In other words, you won’t be able to stop it from making judgments and compelling you to act so… work with it.

4. Learn to optimize that judgment through simplicity, practice, keeping records and knowing your feelings and emotions.

5. Manage your Psychological Capital (Mental Energy) more carefully than you manage your trades.

The money will follow. Your brain will work, your pattern recognition will work and your plan (a realistic one) will indeed be realized.

The Innovation Secrets of Steve Jobs

  
Analysis, Education, Life, LINKS
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No one can deny that Steve Jobs is very successful and runs a very successful company. As head of Apple (AAPL), he has provided numerous direct and indirect jobs (have you seen how many iPhone apps there are now?) and dozens of very, very popular and useful products.

The book The Innovation Secrets of Steve Jobs: Insanely Different Principles for Breakthrough Success by Carmine Gallo, presents a very clear road map to follow in Jobs’ footsteps, showing how to be truly successful in your occupation. Look at a few of the principles covered in the book:

Put a Dent in the Universe
Kick-Start Your Brain
Sell Dreams, Not Products
Say No to 1,000 Things

This book is especially useful to the self-employed, showing how to be more creative, have more effective work strategies, and become more successful.

The author had previously written the best-selling book The Presentation Secrets of Steve Jobs: How to Be Insanely Great in Front of Any Audience. He writes in a clear and concise manner with plenty of supporting anecdotes.

If you are looking for a good read that can help you achieve the success you want and deserve, get The Innovation Secrets of Steve Jobs. You won’t be disappointed.

How Does the Brain Work?-Video

  
Education, Video
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Dr. Neal DeGrasse Tyson & NOVA science NOW delve into magic and the brain, artificial intelligence, magnetic mind control, and the work of neuroscientist and synesthesia researcher David Eagleman. Can we really believe our own eyes? Will machines one day think like us? Can magnetic wands effectively control brain functions and treat depression?

3 Habits every trader must avoid.

  
  Education
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Not having a plan. Get a plan, who cares if it is bad, start with something. You can build off of it and refine it. You have to be willing to spend the time to make the plan yours. You do not start anything without some level of planning. Trading is hard; your brain spends a lot of time in fast forward, affecting your memory. You can slow it down by having a plan and increase your brains ability to remember.  A plan makes it possible to improve. Most importantly, a plan gives you a chance at removing emotion.

Forgetting why you are trading.  The purpose of trading is to make money.  Every action should bend to that goal. That does not mean every trade makes money.  It means every trade gets to closer. If you are looking for comfort, get a teddy bear. If you are looking to be right, play trivial pursuit.  If you want excitement, drive fast.

Letting it go. It is really important to separate what happened from how you felt. The more distance between the two the less time it takes to learn from that situation.  Admitting you made a mistake or are wrong are necessary for letting it go.  Unlike life, you get no credit for admitting you are wrong, it is just a part of trading. Neither matter unless you take action.

5 Types of Brain

  
  Education
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Five Types

To summarize, there are five general brain types. Among traders and investors, the three most important brain types are Compulsive, Impulsive and Anxious.

People with Compulsive Brains tend to get stuck in a particular thought about the market. “It’s too high.” “It’s too manipulated.” “It’s too risky.” It’s too…” whatever. People with Compulsive Brains tend to operate entirely on their own terms and are generally not open to feedback or other options.  

People with Impulsive Brains are the exact opposite. They are unpredictable and lack impulse control in trading/investing and in daily life. Without much discipline, they start many more projects than they finish. They live for creativity and for what’s possible.

People with Anxious Brains live with a rain cloud overhead.  They pay more attention to the obstacles to their own success (or the success of others) than to the ways that something might work. They don’t like to try new things and don’t appreciate novelty. (more…)

4 Steps to Changing Your Bad Trading Habits

  
  Education
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1. Understand the benefit of change. First, ask yourself if you need to change. Then, ask yourself what you need to change. Identify your current habits and ponder the benefits of changing them. Perhaps while trading you are feeling negative emotions such as stress, anxiety, temptation, or frustration. And ultimately, these emotions cause you to make poor, impulsive and self-destructive decisions. Write down what would happen if you were no longer feeling such negative emotions. That is, what would happen if you were able to remain calm and clear-headed while trading?

2. Dissect the proposed change and benefits. Find as many holes in the prospective change as you can. Don’t just convince yourself that things will become better if you change. Make sure the grass actually is greener on the other side of the fence. Be clear about what you want to change and how you will go about it. Write down the benefits that will take place if you do indeed change.

3. Recognize the situation that triggers your self-destructive action. Write down those all-too-familiar conditions, or circumstances, that lend themselves to activating negativity within you (e.g., all the things done, or said, that push your buttons). Also, write down how you are going to consciously recognize them during the day as they happen. Now, next to each item, write down what systems and processes you will implement to avoid letting that situation become emotional. (more…)

Confidence

  
  Education
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When you feel confident, presuming you do sometimes feel confident, where do you feel it? Can you feel it in your brain or is it in your thorax (i.e. middle part of your body)? Better yet, why do I ask?

Well if you think about it, part of our mission here at Trader Psyches is to teach traders of all stripes how to use the message in Gladwell’s blink to assist in the d/m (that is decision making) process. The zillion copies it has sold prove the interest in it but the practical parts about what I read – sort of the “just do it” related to using your instantaneous impressions seem frankly impossible.

And I honestly still feel that most traders are for good reason, stuck in their heads. So, I ask this simple question – when you feel confident where does it hurt?

MRI’s of Succesful Traders

  
  Education
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I’ve seen this study making the rounds on several websites now as a type of neuroeconomic confirmation of Buffetological principles…

Perhaps procedure might be slightly useful as a means of seeing physical brain improvement by training– such as that found through meditative practices.

“Traders who buy more aggressively based on NAcc signals earn less. High-earning traders have early warning signals in the anterior insular cortex before prices reach a peak, and sell coincidently with that signal, precipitating the crash. These experiments could help understand other cases in which human groups badly miscompute the value of actions or events.”

“Neuroeconomists Confirm Warren Buffet’s Wisdom”:

“Seeing what’s going on in people’s brains when they are trading suggests that Buffett was right on target,” says Colin Camerer, the Robert Kirby Professor of Behavioral Economics at Caltech.

That is because in their experimental markets, Camerer and his colleagues found two distinct types of activity in the brains of participants—one that made a small fraction of participants nervous and prompted them to sell their experimental shares even as prices were on the rise, and another that was much more common and made traders behave in a greedy way, buying aggressively during the bubble and even after the peak. The lucky few who received the early warning signal got out of the market early, ultimately causing the bubble to burst, and earned the most money. The others displayed what former Federal Reserve chairman Alan Greenspan called “irrational exuberance” and lost their proverbial shirts.

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