First of all, neuroscience is teaching us that trying to separate risk decision making from feeling or emotion is at best a waste of time and at worse, a sure way to eventually trade-out (like act out) the feeling/emotion that is present. Second, there is a logical fallacy in the idea of “control your emotions” […]
As I prepare for The Galtere Institute’s Behavioral Finance symposium, I am doing what I always do before I speak – catching up on the latest studies on emotion and risk decision making. For example, did you know that there is actually still much disagreement in science about what emotion is and how it works? […]
Traditionally trading psychology advice regarding giving money back has focused on being disciplined and staying focused. Yet traders of all stripes complain to me that while they intend to be disciplined and to stay focused, they find themselves in trades they didn’t intend.
It’s almost like (they say) someone else was in their body making these […]
If you are not at a hedge fund or proprietary trading firm (and in some cases even if you are), you might not really know your own trading. It’s quite easy to look at an equity curve and think that it all you really need to know.
In reality however there is a lot more data […]
Research is showing how powerful our mental context is in making risk decisions. But the thing is, most traders think mental context is about what they know – their insights, their indicators and their experience. In reality, it goes much further and deeper than that.
Recent experience that seems totally unrelated to trading counts. For example, […]
Maybe the toughest challenge in trading – or market risk decisions – is resolving the conflict over now or later? Should I get in now or later? Should I get out now or later? One can throw a whole bunch of so-called facts at the question and still be no closer to a satisfying (or […]
Shull’s first article “What Would Freud Say? Stroll Down Freud’s Mental Path to Profits”, December 2004.
When I wrote this I had NO idea whatsoever that I would ever publicly write or say ANOTHER word on the psychology of trading. It was just an idea I had based on re-writing my Master’s Thesis […]
There is a LOT of it out there.
In short, how much is based on the very latest out of the neuroscience labs? How much or which of many many practitioners actually pay attention to what is being learned about how the brain processes uncertainty and decisions like when to enter a trade?
I know of a […]