Psychology of Trading Workshop

This was the first workshop I attended on Saturday.  The speaker was Stephanie Jaeger, author of "Mind Over Money." Overall I felt this was weaker than any other that I attended.  

The workshop was pretty full with about 200 or so people.  Some of them were already trading live, others demo trading, and some not trading at all. 

Stephanie Jaeger tried to drill home the point that people are very emotionally attached to their money.  She told everyone to take out a $20 bill.  She asked again, do you have psychological attachment to your $20 bill?  Some said no, others yes.   She then told everyone to tear it up into tiny pieces.  I did not and neither did anyone else except for 1 guy.  Some dude Scott was the only one to tear it up because he said he trusts her.  Everyone pretty much found his comment laughable and idiotic until she said that Scott could now choose 1 of 5 bags sitting on the table behind her.  In 1 of the bags was a video IPOD.  Immediately, 4 others tore up their money for a chance to pick a bag.  I already have a video IPOD so I'm glad I didn't.  Either way, 1 person out of the 5 who tore up their $20 bills won an IPOD, the others $20 gift certificates to Starbucks.  So, who trades without emotion?  Emotion is there and don't deny it. 

What is the 1 thing to guarantee your success? 

What is the secret to success?

You.  

She stated that it is also not losing that traders hate so much, it's being wrong.  

She said that it is important to be able to switch your emotional state.  She had us all stand up and think about when we lost or when we were feeling like total losers.  Then she told us to take a step to the right and think about a time of ultimate success.  That is all you have to do to switch your emotional state?

1 interesting thing I found about her comments was how trading intuition can lead to success.  Our left brains are logical and our right brains are intuitive.  

Left brain = technical indicators, books, trend lines, computers

Use your right brain! 

Get in touch with your emotional state and develop an emotional trading log.  Learn to identify your emotions.  What is anger to you?  What is greed to you? What is fear to you? 

Stephanie feels like trading intuition can make traders more successful than mechanical traders.  Traders get paralyzed by technicals.

So the point of all of this was to get in touch with your emotions and try to understand them.  Learn how to switch your emotional state if it's affecting your trading.  We all know that trading is all about psychology and the markets tell the psychological story of every trader participating.  

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