Programming

In the beginning video of our Trading Psychology Corner series, we start at the very beginning point of all the decisions we make… our programming. Based on your genetic personality and prior experiences, your brain writes shortcut programs to quickly make decisions when things arise in the future. When faced with a decision, the brain will run these programs before your pre-frontal cortex can spool up. Understanding that many of our “decisions” have already been made and programmed is the first step of changing behavior in the future. Programming your mind going forward is key to trading profitability and the entire basis of trading psychology.

Have you ever wondered how two people can look at the same thing and come up with two totally different ideas of reality?   This happens due to our internal programming of how we collect and process information based on our personality and confirmation bias.    Our brains create these programs that are always running subconsciously, in order to make quick, effective decisions without waiting for the full brain power to “boot up”.   This makes decisions more reactionary than deliberate.  In this session, we talk about correct programming and how to program your mind to be a successful trader.

Our programming will determine almost every single decision we make as a trader.   If your programming says you “want to make money”, then you will engage in that pursuit and make all your decisions based on that programming.   It is no longer about the trade, the technical setup or risk management and is now about the money.   That P&L on your screen will be the thing making the decisions at that point.

To succeed at trading, we need to have proper programming for what we are trying to accomplish.   This is why the first part of every trading plan should be about YOU, the trader.  What are your strengths? weaknesses? Personality score?   These are the things you can’t change and you need to build a trading plan that works in spite of you and your shortcomings.   Re-framing your mind to be the best trader (which means a trader that strictly follows their trading plan) you can be is a healthy place to start.

Brain Chemistry

In the second video of our Psychology Corner series, we talk about brain chemistry and how it will affect your actions. This video is based of the fantastic work of two authors, Daniel Crosby and John Coates in their books, Behavioral Investor and The Hour Between Wolf and Dog. We discuss the pitfalls of hormones and how we lose control once these hormones overcome our critical thinking. In this video, we discuss various methods to clear out these chemicals and keep control of all your emotions.

This video takes a look inside the brain to the physiological that happen to EVERY human being when placed under duress or undertaking risk.   This is part of being human and we cover the various hormones and chemicals that risk taking produces.   Understanding the chemical reaction is a guaranteed reaction from certain stimuli and programming, we will work to reprogram the brain to send more helpful or less harmful hormones when placed under duress.

Behavior Change

This video takes a look inside the brain to the physiological that happen to EVERY human being when placed under duress or undertaking risk.   This is part of being human and we cover the various hormones and chemicals that risk taking produces.   Understanding the chemical reaction is a guaranteed reaction from certain stimuli and programming, we will work to reprogram the brain to send more helpful or less harmful hormones when placed under duress.

We’ve all heard the saying “bad habits are hard to break”. While that’s true, it’s impossible to break any habit unless you understand the factors that created that habit in the first place. Habits of overtrading, poor stop loss management, bad stop loss placement and trading with emotions cause traders to fail. Without addressing these underlying trading issues, you can’t fix bad habits like overtrading, etc. with more discipline or more encouragement. Understanding why you make these decisions will finally unlock the true key to changing any behavior

Overtrading

How can I stop overtrading? Why can’t I stop overtrading? Making too many trades (overtrading) is a frequent issue, especially for extraverted traders. In this Trading Psychology Corner session, we get to the root cause of overtrading which is the need for stimulus to cure boredom that is most of a trader’s existence as they patiently wait for setups. We discuss several methods to control overtrading and discuss creative methods to end this endless feedback loop to where the trader controls their own trading future.

We’ve all heard the saying “bad habits are hard to break”. While that’s true, it’s impossible to break any habit unless you understand the factors that created that habit in the first place. Habits of overtrading, poor stop loss management, bad stop loss placement and trading with emotions cause traders to fail. Without addressing these underlying trading issues, you can’t fix bad habits like overtrading, etc. with more discipline or more encouragement. Understanding why you make these decisions will finally unlock the true key to changing any behavior, like overtrading.