Wednesday, January 27, 2010

One of the Best Life Lessons I've Learned

Back in the day, I was a graduate student in psychology at the University of Kansas, and I got it into my head that I wanted to experience the other side of the business. So I looked around for a therapist who would be willing to see me for the modest fees I could afford to pay.

Liz was a Jungian analyst, which meant that dream interpretation formed a large part of our work together.

In one notable dream, I was riding in a huge roller-coaster. To my right, there was a lever, which had 10 settings for one's "coefficient of experience".

I couldn't decide on the setting for the lever; the roller-coaster was pretty steep and intimidating. I wound up choosing an 8, but was none too comfortable with the setting.

Liz's comment on the dream stood out for me:

Sometimes anxiety points to our growth.

We're all most comfortable with what lies within our comfort zones, of course. Once we leave the comfort zone, we experience anxiety and uncertainty. But we cannot grow if we forever stay in comfort. We need a high enough coefficient of experience to ensure that we'll be anxious...always stretching ourselves a bit farther than comes easily or naturally.

So often traders look to me to reduce their anxiety.

But sometimes the best strategy is to follow your anxiety and take that ride beyond the comfort zone.



bite me said...

Fantastic post. I can relate to this.
My biggest breakthrough as a trader came by forcing myself buy things breaking out with strength on new highs and sell things getting hammered into oblivion, instead of trying to catch support and fade momentum.
I guess I subconsciously felt the market must be "clever" and trying to trick me. I never had a fear of stepping in front of a freight train and it cost me dearly as a new trader. It has been several years since I stopped trying to buy the bottom and sell the top. I saw the markets behavior as the defensive maneuvering of an opponent, rather than just a market doing what markets do, moving places. By forcing myself to try very simple and orthodox trades I overcame my anxiety and began to silence my biases. I learned to calculate risk/reward.

Sometimes I see stupid entries that I used to leap into and am reminded how much more discriminating my trading has become. I trade less and I trade bigger. It feels good to buy a big a chunk at the right spot and know you just made a great trade. I try to read the market like a surfer reads the ocean. Intuitively and with a healthy respect for its power. You can't fight the ocean.

The Financial Philosopher said...

Great post, Dr. Brett. I'm no PhD but I've observed that the human need for safety is directly related to the desire for control and the tendency to "rationalize" everything, which is to categorize and to look for (and find) patterns in everything, whether a real pattern exists or not.

Randomness and uncertainty provokes anxieties, which brings my point back to the need for safety and the desire for control.

If we let go of the desire for control, the need to define and categorize things, and embrace the unknown, much of our anxieties would be greatly diminished or even removed. More importantly, we give ourselves greater capacity to grow.

Thanks for provoking thought this morning...

"Freedom from the desire for an answer is essential to the understanding of a problem." ~ Jiddu Krishnamurti

Brian said...

Hi Dr. Brett,

My first post here.

I have found your site very valuable in the psychology of trading, something I've overlooked for too long. In addition, your analysis of NYSE TICK has been invaluable as another indicator in my options trading.

Also, I'm thrilled you are a Jayhawk! I have 2 sons at KU, a senior in Biochemistry and another freshman just trying to find his way.

Thanks for your time and insights, a great site.


Dakota7 said...

thanks for saving Mali. Glasd to see that you don't think you're too important or too busy to help the weak and innocent. We do that as often as we can. We don't expect thanks, just a friendly purr once in awhile.