Sunday, November 27, 2016

Hemoencephalography, Creativity, and the Trading Zone

Imagine a child diagnosed with attention deficit disorder (ADD).  Unable to sustain concentration, ADD impairs school performance, but also interferes with social life.  Lowered attention often brings diminished impulse control and unwanted consequences in relationships.  Our child, depicted above, is connected to a biofeedback unit that measures small changes in forehead skin temperature that reflect activation of the brain's executive center, our prefrontal cortex.  This hemoencephalography feedback controls a movie watched on the computer screen.  When the child's emotions are engaged by the movie and the forehead temperature drops as a result, the movie stops.  To continue playing the movie, the child must sustain a neutral, quiet focus.  Over time, the child learns to keep the movie going, building the capacity to flexibly shift between emotional, limbic processing and frontal, executive processing.

Why is this important?  As Kotler notes, heightened concentration and absorption in activity is a gateway to the flow state, the state we know as being "in the zone".  He observes an interesting relationship between flow state and creativity:  in flow, we have heightened focus, but diminished self-focus.  In other words, we turn off our self-critical, self-conscious activities and instead lose ourselves in what we are doing.  If our child became frustrated with the movie turning off, for example, and criticized himself for not being able to keep it going, the movie would remain paused.  Only an absorbed, calm, neutral focus on the movie can make the movie move.

I first encountered hemoencephalography (HEG) feedback when I heard of Dr. Jeffrey Carmen's work with migraine patients.  Interestingly, shifting blood flow patterns is significantly helpful in controlling migraines.  That same technology was helping children with ADD and, I later learned, was helpful in helping autistic children with their executive functioningAs I wrote on this blog, this raised the possibility that HEG feedback could similarly train traders for enhanced attention and self-control, minimizing distractions and impulsive overtrading.

Kotler's observations go one step further.  The zone not only brings greater self-control, but also higher levels of creativity.  When we are in a state of enhanced awareness of our world, we perceive the world in new ways.  Patterns and relationships in markets that we would miss when we are self-focused and frustrated with P/L jump out at us when we've quieted the self-critic and redoubled our market focus.  I recently wrote on the topic of creativity as a form of play.  When we witness children hard at play, we see them immersed--operating in a zone.  To play deeply, we both focus and relaxIt is this calm focus that appears to lie at the heart of creative synthesis.

If we can enhance the cognitive functioning of children with ADD and autism, can we take the normal cognitive functioning of professionals and turn it into an enhanced capacity to operate within the zone?  Can we become more flexible in our emotional and cognitive processing, thereby performing with greater self-control and creativity?  This remains truly frontier territory for trading psychology.

Further Reading:  How to Cultivate Our Creativity

Note:  Thanks to Dr. Jeffrey Carmen for pointing out errors in the original version of this post, which I have endeavored to correct