We’ve all asked this question. Should I stay at the party a bit longer? Should I wait and see if the Cleveland Browns might possibly (by some miracle) pull this game out? (NO!)
But I bet it never occurred to you that this is really the central question of trading. It’s the exit that makes the […]
In the Annual Review of Psychology 2015, Lerner of Harvard points out that from 1970 to 1995 there were virtually NO scientific papers on the subject of emotions and judgment and decision making (JDM). From 1995-2000 there were less than 50 a year and then it began to climb. The number of papers doubled from […]
Trading psychology advice permeates the world of traders. Yet, the majority of traders still experience a challenge that goes like this: “Why did I do that?” They have a plan, they swear they will not make that mistake again and BAM! they do precisely the thing they did not want to do (and swore they […]
Back in 2007, Cal-Tech ran what is turning out to be a revolutionary study on how the brain predicts price moves. The authors found that predicting other people is the key skill behind correctly predicting price moves. In some circles, this skill is called mentalizing but until recently, skill development programs for this ability were […]
It’s easy to confuse the two but as Frank Knight wrote almost a century ago, they are two different things.
Little did he know, that in addition to his logic, the brain reacts to each differently. With risk, or KNOWN probabilities, the brain can handle it in a more or less linear way. With uncertainty, which […]