The Psychology of Trading: Tools and Techniques for Minding the Markets
Author: Brett N. Steenbarger
List Price: $39.95
Our Price: Click to see the latest and low price
ISBN: 0471267619
Publisher: John Wiley & Sons (13 December, 2002)
Sales Rank: 26,383
Average Customer Rating: 4.33 out of 5
Customer Reviews
Rating: 4 out of 5
Well researched and written, but not for the mass
The author's M.D. counsellor-trader identity did help him making this an uncommon trading psychology book full of "highly trading relevant" counselling records from both trader and non trader patients. The catch is: if you are not interested in or equipped with an intermediate level of knowledge about psychology or counselling, I doubt very much whether you can finish reading this 300 page book till its end. To let you have a better grasp of my "worry" mentioned above, I would like to quote something from the last or conclusion chapter, which the author regarded them as 11 of the major themes explored in his book.
1. Behavior is patterned.
2. Your trading patterns reflect your emotion patterns.
3. Change begins with self observation
4. Problem patterns tend to be anchored to particular states. (When you enter a particular state thru emotional, physical, or cognitive activity, you tend to activate the behavioral patterns associated with that state.)
5. Our normal states of mind, which define most of our daily experience, lie within a restricted range of our possibilities. (Your immersion in daily routine keeps you locked in routine mind states)
6. Most trading occurs in a limited range of states, trapping traders in problem patterns. (Traders tend to place greater emphasis on the data they process than on the ways in which they process those data.)
7. People in general, and traders specifically, enact solutions as well as problem patterns.
8. Eliminating emotions is not necessarily the secret to improving trading. (Traders can utilize positive emotional experiences to identify constructive solution patterns and to create an anchoring of new, positive patterns.)
9. Success in the markets often comes from doing what doesnt come naturally.
10. The intensity and the repetition of change efforts are directly responsible for their utlimate success.
11. Trading success is a function of possessing a statistical edge in the markets and being able to exploit this edge with regularity.
In short, if you can appreciate or at least have a slight idea of what the above 11 points try to preach, this book suits you well. Otherwise, please give it a pass.
Rating: 5 out of 5
An excellent, well written book
I have two bookcases full of statistics and trading
books, and The Psychology of Trading is an wonderful addition to the collection.
Steenbarger's book takes you on a very nice tour of human psychology and how peoples' worldviews, motivations, and
experiences form the basis of their interactions and actions. All of the discussions, while interesting by themselves, do lead back to trading sooner or later. No poorly written, academic psycho-babble here; the book is exceptionally well written with clear, flowing prose explicitly recounting numerous case studies, relationships of psychological matters to trading, and many suggestions for traders on self-improvement. Rarely have I read a book that both contained so much useful information and presentated it so well. Brett's thoughts on learning curves, pattern breaking/establishment, and probing people to see who is 'talking his position' are worth the price alone, and the case studies ought to provoke much thought.For comparison, I have read Trading for a Living by Elder, and that book, while interesting, is not as well written and contains far fewer useful examples and thought provoking comments. A useful complement would be Judgement Under Uncertainty, ed. by Kahneman, Slovic, and Tversky which discusses (in a more academic and formal fashion, i.e., it is a collection of really good papers) how people incorrectly process and interpret data in uncertain situations.
Rating: 3 out of 5
Not bad, but not necessary
First, let me start by saying this book will not teach you how to trade (though you could probably see that from the title). I think the book is way longer than it needs to be. The author talks about many counceling events with clients in his life (most are non-trading related) and then tries to draw a parallel with them to trading. When he finally gets to his point about actual trading psychology, he has good things to say. But I think he could have said everything in one chapter. Nonetheless, I found that I was able to relate to many of the behaviors he discusses. I didn't feel like he really gave great help in trying to break the bad behavior, but at least being able to relate to it makes you think about it and pay attention when you are falling into it while trading. There are many other trading books I would probably read before this one. But if you're sick of all of the technical books that try to teach you how to trade, this book might be worth a read. It's actually one trading book that you could take on vacation with you. Similar Products
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