The Psychology of Trading: Tools and Techniques for Minding the Markets / Edition 1

The Psychology of Trading: Tools and Techniques for Minding the Markets / Edition 1

by Brett N. Steenbarger
ISBN-10:
0471267619
ISBN-13:
9780471267614
Pub. Date:
12/23/2002
Publisher:
Wiley
ISBN-10:
0471267619
ISBN-13:
9780471267614
Pub. Date:
12/23/2002
Publisher:
Wiley
The Psychology of Trading: Tools and Techniques for Minding the Markets / Edition 1

The Psychology of Trading: Tools and Techniques for Minding the Markets / Edition 1

by Brett N. Steenbarger

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Overview

"The one, only, and by far the best book synthesizing psychology and investing. In addition to providing modern, scientific knowledge about psychology, this book provides a mirror into the mind and wide breadth of knowledge of one of the leading practitioners of brief and effectual cures. Will help to cure your trading and your life."
-Victor Niederhoffer, Chief Speculator, Manchester Investments
Author, The Education of a Speculator and Practical Speculation

"How refreshing! A book that rises above the old NLP model of the 80's and provides insights on how our relationship with the market is indeed a very personal one. Not only has Steenbarger provided some fantastic tools for the trader to transform his mindset, but he has contributed unique trading ideas as well. Brilliant!"
-Linda Raschke, President, LBRGroup, Inc.

"'Investigate, before you invest' was for many years the slogan of the New York Stock Exchange. I always thought a better one would be, 'Investigate YOURSELF, before you invest.' The Psychology of Trading should help you increase your annual investment rate of return. Mandatory reading for anyone intending to earn a livelihood through trading. "
-Yale Hirsch, The Hirsch Organization Inc., Editor, The Stock Trader's Almanac

"This highly readable, highly educational, and highly entertaining book will teach you as much about yourself as about trading. It's Oliver Sacks meets Mr. Market-extraordinary tales of ordinary professionals and individuals with investment disorders, and how they successfully overcame them. It is a must-read both for private investors who have been shell-shocked in the bear market and want to learn how to start again, as well as for pros who seek an extra edge from extra inner knowledge. Steenbarger's personal voyage into the mind of the market is destined to become a classic."
-Jon Markman, Managing Editor, CNBC on MSN Money
Author, Online Investing and Swing Trading

"Dr. Steenbarger's fascinating, highly readable blend of practical insights from his dual careers as a brilliant psychologist and trader will benefit every investor; knowing oneself is as important as knowing the market."
-Laurel Kenner, CNBC.com Columnist, Author, Practical Speculation

Product Details

ISBN-13: 9780471267614
Publisher: Wiley
Publication date: 12/23/2002
Series: Wiley Trading , #158
Pages: 352
Sales rank: 226,974
Product dimensions: 6.20(w) x 9.10(h) x 0.90(d)

About the Author

BRETT N. STEENBARGER, PhD, is Associate Professor of Psychiatry and Behavioral Sciences at SUNY Upstate Medical University in Syracuse, New York, where he also serves as the Director of Student Counseling. Dr. Steenbarger has published over fifty peer-reviewed journal articles and book chapters on topics related to brief therapy, including standard reference entries in The Psychologist's Desk Reference and the Encyclopedia of Psychotherapy. He teaches techniques of counseling and psychotherapy to graduate students in counseling, doctoral students in clinical psychology, and residents in psychiatry. An active trader who conducts his own statistical market modeling research, Dr. Steenbarger has written feature columns for MSN's money site (www.MoneyCentral.com), many of which are archived at www.greatspeculations.com.

Table of Contents

Chapter One: The Woman Who Could Not Love.

Manufacturing Cars and Success.

Sue, the Survivor.

Finding Solutions amidst Problems.

Accelerating Change by Doing What Comes Unnaturally.

Going against the Flow with Sue.

Finding Solutions.

The Fearless Trading Inventory.

An Inventory of Solutions.

Enacting the Solutions.

Conclusion.

Chapter Two: The Student WhoWouldn’t Study.

Ken, the Failure.

Diversification in Life and Markets.

The Psychology of Paralysis.

Decisions and Uncertainty.

Altering the Risk-Reward Equation.

Shifting Risks and Rewards in Trading.

Music, Moods, and Pivot Chords.

Tom’s Pivot Chord.

Breaking Routines.

Breaking the Routines of Trading.

Conclusion.

Chapter Three: The Woolworth Man.

The Interview from Hell.

Observing Patterns.

Invoking the Internal Observer.

Rule-Governed Trading.

Taking Your Emotional Temperature.

Inoculating Yourself against Stress.

Effort and Emotional Change.

The Trader as Addict: Breaking Stops.

Becoming More Rule-Governed in Trading.

Using Emotion to Make the Contrary Move.

Conclusion.

Chapter Four: Traders Out of Their Minds.

The World’s Most Powerful Glasses.

Phil, the Addicted Trader.

Exploring the Dual Mind.

The Mind of the Trader.

Solution-Focused Money Management.

A Trade from the Couch.

Shifting Selves in Trading.

Stationarity and the Moods of the Markets.

Conclusion.

Chapter Five: Mary, Mary, Quite Contrary.

Getting inside Mary’s Journal.

Afflicting the Comfort Zone.

Repeating Patterns.

Changing Repetitive Patterns.

Doing What Comes Unnaturally.

Resisting What Is Best for You.

Creating Powerful Emotional Experiences in Trading.

Conclusion.

Chapter Six: The Evil Spiders.

Communication and Metacommunication.

Metacommunications in Trading.

The Communications of Traders’ Bodies.

The Mind beneath the Human Mind.

Knowing More than You Know: Implicit Learning.

Minding the Complexity of the Markets.

Conclusion.

Chapter Seven: The Big Man beneath the Bed.

Big, Silent Walt.

Creating Powerful New Experiences.

Regression: The Mind’s Time Travel.

Entering the Time Portal.

When Your Gears Remain Locked.

Novelty: The Key to Change.

Novelty in Therapy: Making Translations.

The Role of Consolidation in Change.

Walt’s Consolidation.

Conclusion.

Chapter Eight: Buried Alive!

The Art of Timing in Therapy and Trading.

Markers and the Markets.

Markers with the NYSE TICK.

The Power of Dreams.

Dreams as Emotional Communications.

Repetitive Dreams: The Themes of Life.

Hypnosis: Accessing Other Minds.

The Waking Trance: Daydreams.

Conclusion.

Chapter Nine: Trance-Forming the Mindscape.

The Radio Dial of Consciousness.

Changing Behavior by Changing Contexts.

Trauma and the Radio Dial.

Dr. Brett Receives Strange Communications.

Mind Experiments.

Mapping the Mindscape.

Experiments with Trading.

Conclusion.

Chapter Ten: The Coat in the Closet.

Stopping the Morning Frenzy.

Stopping on the Way to New York.

Knowing More than We Know We Know.

Joan and Her Inner Voices.

Repairing Multiplicity.

Triggers.

Joan’s Lullaby Therapy.

When Efforts at Change Fail.

Conclusion.

Chapter Eleven: Pinball Wizardry.

Creating Models of the World.

Modeling Yourself as a Trader.

Playing Market Pinball.

Contrary Trading: Fading the Maps of Traders.

Internal Maps and Inkblots.

Maps and the Language Traders Use.

Conclusion.

Chapter Twelve: A Session at Gunpoint.

Jack, Man in Crisis.

Facing Life’s Challenge.

When the Game Is on the Line.

The Edge in Crisis Counseling.

Dr. Brett’s Trading Crisis.

Creating Change by Creating New Roles.

Leaps and Tempos.

Conclusion.

Chapter Thirteen: A Dose of Profanity.

Understanding Your Relationship with Yourself.

Dave, the Narcissist.

Regression and Multiplicity.

Narcissism and Regression.

The States of Daily Experience.

Effort and Partial Consciousness.

Achieving a Novel Mind Frame.

Changing the Posture of Mind.

Conclusion.

Chapter Fourteen: Trading from the Couch.

Propositions for Trading Psychology.

Changing Your Mind: Applying the Principles.

Matching Your Trading to Your Personality.

The Great Frontier: Developing Trading Expertise.

Implications of the Implicit Learning Research.

Greatness and the Acquisition of Expertise.

Etching the Brain.

The Quest for Market Mastery.

Bibliography.

Index.

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