Oil N' Gold - Resources for Serious Traders
The Most Common Problem Traders Face Print E-mail
Tutorials | Articles | Written by Brett N. Steenbarger |
There's one problem that seems to be universal to traders, whether they're professionals trading in large banks or funds or part-timers trading from the home: performance anxiety.
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The Most Important Question to Ask When You're in a Slump Print E-mail
Tutorials | Articles | Written by Brett N. Steenbarger |
Slumps happen. The trader who has a respectable 60% win rate has a 2.5% chance of losing four times in a row simply as a matter of chance. That doesn't sound like high odds, until you realize that, over the course of regular trading, such strings of losers are virtually guaranteed to happen.
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Techniques for Overcoming Performance Anxiety in Trading Print E-mail
Tutorials | Articles | Written by Brett N. Steenbarger |
A little while back I made the observation that performance anxiety is the most common psychological problem that I encounter among traders. It occurs in many forms - during slumps, at times when traders attempt to raise their size/risk, when life's financial needs add pressure to trading outcomes - but the common element is that a concern with the results of trading interferes with the process of trading itself.
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Oil Basis - Grades Of Crude Oil Print E-mail
Tutorials | Articles | Written by Oil N' Gold |
Many readers asked why London Brent crude futures price is always lower than Nymex WTI crude oil price. There's nothing related to exchange rate but quality of oil.
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Overview of the Relative Dollar Volume Flow Indicator Print E-mail
Tutorials | Articles | Written by Brett N. Steenbarger |
Before I post a sector-by-sector analysis of relative dollar volume flows into the various segments of the S&P 500 Index, I want to head off questions by reviewing the logic behind the relative dollar volume flow indicator. For background, here is my initial post on the topic; here is a nice illustration of the pattern of flows that preceded the big market drop in late February/early March; and here is a post that illustrates flow patterns at market bottoms. An illustration of flow in the S&P stocks also illustrates trading patterns.
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Three Thoughts on Freud and Markets Print E-mail
Tutorials | Articles | Written by Brett N. Steenbarger |
Here are three insights from modern psychoanalytic theory and my comments to apply those to performance fields such as trading: 1) We internalize our sense of self from our significant relationship experiences, 2) We defend ourselves against sources of anxiety and 3) We tend to replay conflicts in past relationships in our current relationships.
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Changing How We Cope Print E-mail
Tutorials | Articles | Written by Brett N. Steenbarger |
In my last article, and the first of this two-part series, I introduced the topics of stress and coping. We saw that stress is intrinsic to trading--and to all activities that involve high degrees of risk and uncertainty. Whether this stress becomes chronic distress, however, is a function of our coping. People utilize a variety of coping styles, including emotion-focused, problem-focused, and avoidant strategies. These methods for dealing with threat are neither good nor bad in and of themselves.
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Brief Therapy For Traders (Parts 1-4) Print E-mail
Tutorials | Articles | Written by Brett N. Steenbarger |
It is commonly assumed that the role of the psychologist is to help people with their problems. Lodged in the backs of our minds is the image of the patient on the couch, talking with a Freudian analyst. In reality, applied psychology has come a long way from its beginnings as a "talking cure". Indeed, many of the newer approaches, which have been extensively studied and validated through research, do not emphasize talking at all.
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Behavioral Patterns That Sabotage Traders - Part Two Print E-mail
Tutorials | Articles | Written by Brett N. Steenbarger |
Consider the following psychological scenarios: A student needs to pass an anatomy course final exam in order to successfully complete his first year in medical school. Because his first several exams were on the borderline between passing and failing, the course grade entirely rides on the final.
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Behavioral Patterns That Sabotage Traders - Part One Print E-mail
Tutorials | Articles | Written by Brett N. Steenbarger |
Although I do not maintain a private practice of counseling/coaching for traders, it is perhaps inevitable that traders would contact me for assistance after reading my book on The Psychology of Trading. Once in a while I take on a project of working with a group of traders because of the opportunity to push the envelope and use psychology to improve their trading performance.In the past few years, I would guesstimate that I have gathered personality questionnaire data and assisted over one hundred traders.
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Characteristics of Professional Traders Print E-mail
Tutorials | Articles | Written by Brett N. Steenbarger |
I'm on the road this week working with traders at several professional trading organizations. It's always an enlightening experience to see how the best traders and trading firms operate. Here are a few observations that have hit me between the eyes over the past several days:
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