Trading Video Disciplined Trading Van Tharp

[Music] my name is van Tharp and I have two roles in life one is I'm a coach and by coach I mean somebody who finds very talented people teaches them the fundamentals and fundamentals in this case doesn't mean fundamental analysis that means the fundamentals of the process of trading and then make sure they follow those fundamentals because trading is as much or as much reflects your performance as any form of athletics reflects your performance and there's a bottom line measurement your profits or the smoothness of your equity curve so that's one of my roles the second role I have is I'm a modeler and by modeler I mean I find people who do things very well and I find out what they do in common and then develop a model out of that that I can train other people and when I get the results that I'm expecting then I know the model works and I modeled the trading process that came into my home study course which many of you probably saw way back and came out 10 years ago and then I did a lot of seminars with s Dakota poem Basso and we were all of them stressed money management which I not now called position sizing and so we modeled that process and how important it was and then we used to say that trading was 60% psychology and 30% money management at 10% system so I thought well I'll model a part that's not that's not system and that came out to be basically this block trade your way to financial freedom how many of Retta about a third of you and for those of you who have read it you'll find it's quite psychological a lot of the people have biases to do all of the wrong things now I was in the original market Wizards in 1989 how many of you read that few more then if you haven't that should be your first read and at that time and I'd worked in interviewed people like Ed sakoda on Richard Dennis and Marty Schwartz and a number of others and I knew how they thought what the process was for trading but my goal at that time was to produce people of that quality and that that takes a while I mean you don't go out apply the model you have to have a long track record and not only that you have to have a long track record with a fairly substantial amount of money if you don't have any money to begin with it takes a while to get up to that and then you have to have a fairly good track record after that well I've got people now I've got several stock traders with well over a million dollars who are making a hundred percent a year I have an arbitrage options trader who I worked with in 1987 and he's met he made well over fifty percent a year for seven years while he was doing that particular business and I think he had to losing months in the seven years there are a number of others I have a SP day trader I have a cup of stock day traders and my stars David Mobley who wrote the foreword to my book has got about a half a billion under management mostly offshore he has only had well he's up on average of 50% Neff to invent net to investors after his fees every year since 1992 and I think he's had five losing months none in the last two years so that's where I was and now I have and at this point I don't need my money I trade my money with my traders in other words I have a substantial amount of money with them they tried it since they're earning those great rates of return I don't need to work anymore so I kind of established a new goal which is to have an offshore fund that basically well there are several goals I'd like it to be such that any one of you could participate that fee in that fund so we have some problems in that Americans are supposed to participate in offshore funds and and you know most funds are for qualified investors so there's only so many you can participate well we want to live invest the structure where you can participate if you've got twenty five thousand dollars or something of that nature earn the kind of fees that we're earning I want about 25 of my traders on that fun doing it and and on my profits I want to go to charities that sort of figure out or transform how people think that's what I'm all about and that's what this talk is all about it's all about transforming how you think and it's all about the the the differential the the in the discipline that comes that's essential for the trading process you know why it's a continuation on the first talk how many were in the first talk well what we did in that seminar was we played a game took most of the seminar but we played a game and all I did was draw marbles out of a bag and 60% of those were winning marbles 40% were losing there was a ten to one winner and a one to one loser and what it represented was a system and the point I divided a group room into three groups and each group had a specific objective this third was to make as much money as I could and I wanted at least the third of the room to go to a half room to go bankrupt and this third their goal was to make to double their money and this third their goal was not to lose any money each group had a different kind of distribution lyonell equities we didn't assess all of them but it was pretty clear that generally they were following the thing and the interesting thing is except for the zeroes the people who went bankrupt we assessed 30 people every one of them had a different equity at the end and they all got the same tribes so there are only two factors involved first was how much you risked which is what I call position sizing and the second was a discipline involved in following the system and doing whatever it was and not getting crazy well as this talk is about that second phase which is that is a discipline now the main reason why it's so difficult for most people to follow a system it's because we are exposed to a vast amount of information that information doubles in less than a year I mean the birth the the thought was it took from the Year Zero to the Year 1500 for our information to which humans were exposed to to first double well now it doubles in less than a year and us traitors get exposed to probably more than anybody else and the only way you can process all of this is to do what's called judgmental shortcuts there are a whole lot of shortcuts that are come into play in the whole area of behavioral finance in the academic world is about that but I'm kind of about applied behavioral finance how because the key is not how to use the stuff to predict the markets the key is how to use this stuff to change yourself now to give you an idea of your limited capacity I'm going to give you a series of numbers and I'd like you without writing them down let's see how many you can remember 37:51 twenty nine eight thousand two hundred and nineteen forty one nine thousand two hundred and seventy three eighty two anybody got them all probably got 82 well each number could be considered a chunk but I threw in some big numbers which actually might be four chunks all of which kind of illustrate how we can only process a certain amount so we've got to have all these shortcuts to take to get in the Y in addition we've all got these emotions that come up and I don't somebody asked me on the radio on a radio interview the other day are there any positive emotions that are good for traitors I don't think so you know if you like prophets if you get really exciting or elated about prophets why then you take tend to take them so too soon or you think you are the market both of which are disasters you really have to be very neutral so you can stay in the now so as we get through this my overall model for successful trading is in this this inverted pyramid here at the bottom I've got what I call inner strength it's like it's kind of like being very clear it's like allowing yourself to go with the flow and not get anything in the way such as all these judgemental biases that we were talking about so everything kind of filters through this and this is called kind of the area we're going to focus the most on in this talk on the right side you have what I call the ten tasks of trading and actually in your notes under our tank prudence no I'm not going to talk about them today because that would take two hours to do but under Hank prudence notes you've got actually a listing of the ten tasks of trading and above that is like is discipline part of also what we're going to talk about today and above that is like a business plan how many of you consider yourselves professional traders raise your hand and out of you how many of you have a business plan that's pretty good because trading is a business most people fail because they don't plan most businesses fail because I don't plan and most traders fail because they don't plan I have the rest of you how many have a plan written business plan not very many and it's one of the steps you need to take on the other side I've got system development and testing once again that's the topic of my book and money management which we've already talked about and that was the topic of the of the prior talking by the way I call out position sizing now I look that up in the internet once the topic of money management and I came up with everything from managing other people's money how to get yourself out of debt controlling risk and even the money management such as Ralph Vince's Ralph Vince considers money management how to make the absolute most money you can and I consider awk so I've changed it too and I remember being on a panel once where we were talking about parts of a system and there were several people who'd written books they were talking about parts of a system nobody mentioned what I call money management I said it's the most critical part nobody mentioned us and one of the other panelists said well I always believed in a money management stop meaning $1500 stop or something like that again that's not money management so I changed the name to position sizing which tells you how much and that's really the essence of meeting your objectives and trading with position sizing you can meet your objectives and it's a critical thing to know about but it's not as much the topic of this seminar or the workshop now the factors involved in discipline get that a little bit more centered the most important factor I'm continually asked what's the most important factor of great traders and to me that's a its responsibility or a topic that I call respondibility now one of the things I usually do in that game and I didn't do it in this particular game because I didn't have the time to do it it's is you know actually I did but I didn't do this part of it if I assign losses to particular people because when you pull marbles out of a bag you're going to have streaks so you know Roger here happens to pull out a losing marble I'll have him pull out another one and then another one so eventually there's going to be a long streak and somebody's going to be assigned to it in the my guinea pig year was actually Omar who pulled out a five to one loser and then three or four others and everybody was groaning and everybody wanted to show it Omar and I actually gave them a chance later and so then he pulled out a winning marble so and if I were to ask the audience you know how many think you went bankrupt or you lost money because of Omar you know I'm sure I would have gotten some hands rise and the if you read if what person raised their hand to that it means they learn nothing because they thought Omar did it to them it's like the market did it to me or my bunker did it to me or the software's no good or the system's no good all that happened is that certain people didn't manage their or didn't practice proper position sizing the streak that happened to hit them was produced by Omar but you could just as well blame me for playing the game in the first place so this gets really really what tends to happen as a traitor is that you must assume some sort of responsibility for everything that happens you when you do if you if you ask yourself the question how did I produce that then you can say did I make a mistake how did it come about and you can fix up if you say Omar get up or they did it or the broker did it or the market makers did it then you get to repeat the mistake over and over and over again I played the seminar in the or or this game in the orientem in about nine different cities with an audience of about the size and I remember yeah one group and I said this generally applies if you blame it on somebody else no well this one lady basically said well you know I have a problem my husband and I said it's him and I said well if you blame it on him you got to repeat that over mistake over and over again she said no no I'm divorcing him which to me illustrate the point she's going to repeat the mistake again she'll probably find somebody who does the same sorts of things we got talk a little bit more about respondibility but I want to get in a few of these other things the second area that really tends to interfere with discipline is the emotions and the emotions tend to be a lot of you grew up with John Wayne as a hero and you learned that men don't feel or feelings and women had unusual role models too but the idea is you don't feel your feelings and if if you had a temper tantrum when you were kid I'm sure mom and dad decided you shouldn't do that if you were fearful mom probably patted you on the head and said there there don't cry and you got the idea you shouldn't feel your feelings but what happens when you feel feelings when you don't feel your feelings is that you stop them inside they stay inside you and then they tend to come up over and over and over again let me give you an example of how that happens in a way you can probably understand and it usually happens earlier than this but here this would be the example let's say you're a teenager and you see an attractive woman or man and you decide you want to go out and ask them out so you kind of wander up them hey how would you like to go out with me and those persons had a bad day goes get lost creep and suddenly you feel really rejected ah she's no good he's no good kind of wander off and then you think I shouldn't feel that so you stop the feelings now next another week goes by and you see another attractive person and you want to approach them and you start off and you get about this far and it's kind of like a voice goes off in your head says remember what happened last week you felt like this and it releases a tremendous amount of the stored rejection you know now this girl has suddenly or guy has suddenly rejected you even though nothing's happened you suddenly feel really rejected let's say you get braver you get about here well now the rejection feelings are probably almost as strong as they were at the moment of rejection you get about here you know you're gonna be rejected so you probably approach them something like you wouldn't want to go out with him you would you which produces the response you expected get lost creep and so what happens is you reinforce the cycle and you get this and it comes up over and over again you have problems with the rejection cuz you didn't want to feel the feelings in the first place any feelings you don't want to feel will come up over and over again in the market as an example let's say I'll just kind of draw it with my hand look say you're trading breakup market comes out breaks it out you get in you place a stop down here starts to go up a little bit and then it starts slowly going down like this boom low point of the day that's you getting stopped out now it goes up and now you realize it was a low point of the dye well that's a good thing to trigger your anger now you're angry goes up ticks up more you're getting more and more angry goes up more now it's about your entry point now you're really angry and then it ends up way up here in about the time the day clauses and it's way up here you realize you've just missed the second entry point so now you're furious and you go home and yell at your spouse and kick your dog all because of stored feelings relating to some emotion now some of you probably have fear you know you can find lots of reasons to be fearful well if I get a nap if I don't put a stop real close it's going to come down and take me out or if I get in this mood now it's going to take me out or you know this looks like a good signal but I don't think I'm gonna take up you know they always get me all these reasons to justify fear or any other emotion so we're going to talk about some ways to deal with emotions in a few minutes the next thing that tends to go on is conflict this this has made it based on the assumption that you have parts of yourself in every theory of personality that I know of assumes you have parts Freud says we have an e D ego super-ego and certain psycho symptoms synthesis assumes we have thousands of parts well I let you assume you have whatever parts you think you might have which is like roles you have in life feelings that come up you know that rejection feeling Isle straited could easily be a part of talking in your ear now what happens is here's and here's a common example let's say you have an excitement part and your excitement part you know it does somehow you tend to suppress excitement and you don't go skydiving and and hang gliding and things like that or maybe you do but you don't get enough maybe that's once a month and this wants action every day so it goes into trading and you could watch your screens and a little blips oh it's going up I know what's going down sell buy sell buy sell well good trading tends to be boring I don't know how many of you agree with that but it is good trading tends to be boring and if you're in really into the excitement you got to find some other things to do in a case like this if you recognize how this a part of you like this is sabotaging yourself give us part other things to do that aren't quite as disastrous for your financial well-being last area I will cover just briefly is what you believe about yourself kind of the bottom of the hierarchy let me I'll show you up the Gillis I'm not going to go into this in detail but we have a series of beliefs and beliefs about the environment well most of what I've said so far in this talk has been environmental beliefs lots there's lots of them there's beliefs about your behavior you know which might be if I bang this desk Richard again his hair might stand up on him especially if he isn't expecting it that's just an environmental belief I happen to have capability belief are you capable of doing something if you believe you are then you have a chance if you believe you are you won't even do it value what's important to you and then down here is identity beliefs and this is what you believe about yourself and most importantly it's how worthwhile you believe you are if you for example have a belief that I 5ik I'll feel better about myself if I become more successful financially how many have a belief like that honest one please what happens is that's two levels of beliefs it's a behavior belief which says I'll feel better about myself when I become worse than more successful financially but then there's a belief about yourself and your self-worth which basically says you know I don't really feel like that about myself since these tend to form a hierarchy with this down here then this tends to get a precedent and it produces more effect than any of the other it's going to predominate so you start making money the belief about yourself will come into play cause you to lose will probably cause all of those feelings to come up that we talked about earlier or the complex and might be the root of it so let's take a look at self-esteem or let's go to responsibility first I like to do exercises and seminars because I think you experience a lot more from from exercises so what I'd like you to do is take a few minutes and write write down three of your biggest trading problems and maybe three of your biggest life problems and if you can't think of any that's already your problem so those of you watching on the tape can do it that way take some time three greatest trading problems Rikka greatest life problems okay you could work on this a little bit lighter if you haven't finished and you probably don't have an exhaustive list certainly in the short period of time we've done this now these problems can fall it's the way you stated the problem that's really important what happens with problems with the trading problems let's say you write down I get angry at the market well that's emotion inside you can fix that I'm fearful can't pull the trigger that's emotion inside said I don't have a system that's blaming it on something else they get me floor traders get me I can't find the right setup whatever it happens to be you're going to find that generally your answers fall into two categories one of them has to do with something happening inside of you so look at each of your answers and see whether it's something happening inside of you or whether it's something outside of you if it's something happening outside of you start thinking about how you produce it because then you can do something about it otherwise you're doomed to repeat that for the rest of your life until you figure it out in the example again it's the lady who wrote down her spouse their spouse was the problem she's gonna find spouses who are problems for the rest of her life now I'm sure none of you wrote that one down since I already use that as an example but if you rub down my spouse presses all my buttons or my spouse makes me angry or my spouse does this then it's stuff inside that's you that you can work on and then you can change those things sometimes it's a slow process of cut back to me one of the most valuable things you can do as a trader is to continually monitor yourself for how you are what what is it about you that's producing your results and when you actually discover that it opens up a whole new world because you know there are things like athlets seem to be like acts of God that happened to you good example we ran a trading school about eight years ago and we screened 200 people to get 20 people into the school an idea in this in the initial part of it was a phone interview and then we did a two-day seminar as a screening process and one of the key things I was looking for were people who are really ready to own their results now we had somebody in that class who was quadriplegic could barely use one hand and it was a result of a football accident now he was really upset at this idea of responsibility because it was like well there's no way I produce that football accident it just happened to me and now I'm a victim and I'm in this wheelchair but he went oh he started thinking about it he didn't get accepted into the school but he started thinking about it he did some consulting work with me later and he said to me later on that the most freeing moment of his life was when he decided that it's some why he was responsible for the football accident set himself up mentally he was ready in some way to for that kind of thing to happen when he made a shift internally to decide that was that maybe even it's just little small why he was responsible for us the real chef was because now for the rest of his life he was now in charge of his life he could create it as opposed to being a victim and the first thing he did after that is go out and get a handicapped dog that did that was designed to perform certain tasks like roll him over and bad he didn't have to have a nurse to do that it became more impending the dog would do it the dog was very smart he could train it to do all kinds of things trained it to go into the refrigerator and get him a beer so suddenly he had a whole new control over his life simply because he adopted this whole area responsibility and when you do that as traitors begin to think that everything that happens to me is a traitor I somehow created even if it's just your response to it you're on the road to turning around to becoming much much more successful another exercise now all of these should have this but for those of you who don't I'll read them out this is what I call self image inventory what I'd like you to do is rate each of these ten items on a zero to four scale zero being it doesn't apply to you at all for being it applies to you very strongly it definitely applies to you so the first item is I tend to take losses personally now does that apply to you yeah zero to four right on a zero to four scale second item is when people gives me give me gifts I tend to feel uncomfortable or I need to give them something in return write down a zero to four number three I kind of blame others for what happens to me or for my problems zero to four number four I really I don't really enjoy being alone with myself right yourself there one two four zero two four number five I have trouble being open with other people and I tend to hold back rate it zero to four number six I often need to defend what I say or what I do write down 0 to 4 number 7 I tend to I feel put down when criticized number eight I tend to have some shame guilt and blame probably should be an or rate that zero to four number nine I get jealous about the good fortune and success of other people number 10 I need approval attention prize from other people to really feel good about myself right that zero to four now give yourself a total total your answers one to ten okay how many have score of five or less three so my guess is you're either fairly you this this test would suggest that you have very little problems with self-esteem that you're probably fairly successful with the markets and or you delude yourself the first person I gave this test enough talk before the managed futures Association meeting in Las Vegas maybe ten years ago that's where I first met Tom bass ow he was the only one in that whole group who raised his hand to that and and I hadn't I see a lot more now of scores in that range but he was like one of the first I've ever seen and I thought you're lying but I met you know we talk later on and he and I became best of friends and thought we probably did 20 seminars together and that was our introduction was that particular score now how many scored ten or less you probably don't have too many problems with self-esteem it does that you do well with it you could probably do a little bit better twenty or less you've got areas you need to work on and it probably in some ways affects your trading and I won't ask the rest of you okay how many of you read the last chapter and market Wizards which was mine and how many of you remember a technique there or what I thought I called the wizard technique one person raised their hand as a technique that I wrote at the time is very good for our controlling discipline or controlling your mental state it combines a whole lot of things but I found most people who read that book tended to skip the last chapter and if they skip the last if they didn't if they got that far they didn't remember that particular technique so what I'm going to do is illustrate the technique and it's something you could use and we'll talk about the the elements that are involved in it Oh mark can I have you as a volunteer where it'll be great for you well use you is your seat now can you remember our time when you're really stressed as a traitor or in anything else okay well remember that time get into it and act like you're in that situation remember what it was like because we're going to show you how to get out of it so remember what it felt like got it okay now what I want you to do is get up stand up I want you to walk over here turn around and I want you to look at Omar no no this way I want you to look at Omar sitting in this chair in that particular situation now we'll see look like this table so what is a person who's pissed off look like what what's what's his posture life okay and you're kind of gritting your teeth they're saying a few words what's your what's your breathing like there when you're in that probably don't breeze one of the things people do now what I'd like you to do is to a mat either can you think of a great trader who might be in that same situation how they handle up if you can't think of any one particular make one up it's either one work ok well imagine one there and see what they look like in the same situation ok now go back and sit down and be what they would be like in that same situation because you do that now okay now that technique combines the number of things that change your mental state the first thing a does is he gets up as soon as you get up you've changed your posture you've changed a lot of the elements in that state that he was in before so that's the number one you want to write these down because all of these will change your stage the number one is that chain you change your posture the second thing he did was he went over here and he started looking at himself in that situation called dissociation when you're dissociated you're much less emotional you can you can be much more objective so he automatically went from an associated state where he was really into being mad to dissociated where he was watching himself both of those are enough to change your stage number three he then modeled somebody else and it doesn't have to be a real person you can fantasize a super traitor Tom Basso used to fantasize the super traitor so you can have anybody you want be there in that particular position or it can be somebody you know doesn't matter and you look at what they would look like then and be really observant of what their breathing would be like what their posture would be like what their facial expressions would be like because it all makes a big difference and then you've gone assume that position in the same situation now this is something you can you know when you if you adapt an attitude of being responsible for what happens to you then the first part of that is to begin the notice when you're in this kind of state most people are just in it they don't realize they're in it they're just in it you know it's controlling them so first step is to is to say oh I'm doing that thing again or this is what you know you might say you're you if you look at your training problems reframe them in terms of what you do which might mean I get into that state and then begin to notice when you get into that state because then you can do the same exercise and it's one of the most powerful exercises I know for immediately changing your state because it combines all of those things now one last aspect of this is one of the tasks of trading this it's one of the most important it's in it's a task that I call mental rehearsal every top athlete that I know of does extensive mental rehearsal before the game they're playing or the situation they're playing and mental rehearsal is something you should do I'll give you one example I don't have a lot of time to cover I want to and I want to give a few minutes for questions but Jack Nicklaus for example gave his whole strategy for playing golf it was extensive mental rehearsal he said the first thing he did was he imagined the golf ball landing where it he wanted it to land and then he looked at the flight of the golf ball that would cause it to land there and then he saw himself he was dissociated he watched himself make a swing that would produce that flight of the golf ball then in his mind he made that swing from an Associated viewpoint just been his mind just mentally rehearsed up then he might actually take a practice swing and then he went up and did up a very extensive rehearsal process and I could go on and on and on about this topic it's so important probably I could talk for an hour about it but Omar not might not even despite the fact that I told him keep a diary might he might not realize when he gets into one of these states because what happens under stress I talked about your limited capacity but what happens under stress is the blood flow does not go to your brain it gets diverted and it starts going about 20% of normally 50% goes to your brain under stress about 20% goes to your brain and the rest goes to the major muscles of the body that's not going to help you as a traitor what it does is it gives you a lot more energy and it shrinks your capacity for processing information down to pee sauce and you do a lot you do things with a lot more energy and that's not very useful as a traitor however if you put things into your unconscious Minds through mental rehearsal for example Omar knows now he gets into a state like this he can rehearse in his mind over and over again that particular task getting stressed getting up doing that tau when he does that then he's ready for it when it gets him to that state and consequently it becomes an automatic thing rather than reverting to a primitive type state so those are that's the major suggestion for emotionally controlling your state but let me just summarize key factor that I'd like you to remember as to that a you in some way are responsible for what happens to you even if it's just your reactions to what happens when you realize it's not necessarily them but it's your in some way contributing to it then you can start fixing the process and we talked to well we talked about a number of different things but in terms of fixing the process it's a it's usually some emotional state that's behind us and we talked about then that market wizard technique getting up which changes the state watching yourself and what you were doing which changes the state modelling somebody else and then assuming that position and we're cursing that many times so it becomes automatic to you all of that will make a big big difference in your performance and the first step I would recommend is that all of you read my book about four times and not just once about four times it makes a big difference and then that gives you kind of a foundational in which you can apply some of these stuff because many people I find aren't - aren't actually doing what I call the fundamentals of trading they're doing other things so I have about five minutes for questions yeah what is your best I don't feel that I might be necessary myself I find myself taking trades that might not normally take trying to find the dinner now what what recommendations first thing I recommend is that you simulate your own system because I mean even if you have a 60% system and you take a thousand trades you're gonna have 10 losers in a row I mean that's almost a certainty that you'll have 10 losses in a row with a 60% system your systems 15 percent it might be 17 in a row if it's like 40 percent you could have be over 20 in a row and that's just by chance so figure out the probabilities of your system create a marble bag out of it and when you do that then start playing that game pull trades out out of the bag figure out how much you're risking on each one and and do that it's a long process as a form of mental rehearsal then you know then you get used to the four winners in a row and you realize that's just part of the process as opposed to saying suddenly my systems broke because these things just happen by chance right it's not you it's a set it's a system that we tend to make it worse by exaggerating that so when you have streaks like that that don't work that's what I'd recommend we're gonna have software to do that and in a few months so my website is IIT m.com you can find out about it through that III TM com other questions yes that's my definition yeah okay well it's more than now I would say the question is a super trader as somebody who say making forty percent a year on a large amount of money what constitutes a large amount of money well I would we actually have a program to develop super traders first phase of it when they're really getting you know I want them to try it and it initially to be showing they can do that their system works means they make 40 at least forty to fifty percent was a year with maybe no more than two three at most losing months I want them to be able to do that with two hundred thousand dollars at least and then I you know then our program is designed to if they can prove that to them give them a million dollars so that they can do that and if they can do that with a million dollars it doesn't take long to have all the money in the world or whatever they you know whatever they can handle with their capacity so we're talking seven figures at least now I'm not talking you know you when you get up into the bill when I talked about an offshore fund I was talking about maybe 10 billion I'm not talking trillions or something like that because you get to the point where you just can't move things in and out of funds and everything went else but you know David Mobley's making at least fifty percent after fees and his fees are very high trading a half a billion dollars right now with no losing months not at least not in the last 24 months other questions yeah feelings okay the question had to do with discharging feelings that there are various levels of feelings some very minor some more well I'll you actually give you a technique you know if you've got a feeling the tends to dominate your life for example if you are a you know if you've lost somebody close to you and you're going through grief or something like that what I and you notice you're doing this 16 hours a day you have this feeling what I would suggest is that you go to a neutral spot like a park bench or something sit down and say to yourself alright I've been doing this eight hours a day I'm going to really do it for an hour so you sit down on the bench and you really feel the feelings and I wouldn't get into the story behind it but just the feelings what's a feeling like in your body the story tends to exaggerate things and it's not as significant anyway get into what you know if it's anger what's the anger feel like you really get into what the feeling is itself and then just start feeling it and feeling it what will happen is you'll get bored you know you after twenty minutes you might be thinking I have to do this for an hour and if you do it for forty it might even tend to go why got to keep your agreement do it for an hour and you got to do it for at least a week but if it goes away after 40 minutes on the second day you only have to do it for 40 minutes and by the end of the week it tends to be just disappear so that's what I'd recommend for really strong feelings yes in the back they have the question was to define behavior finance behavior finance is really a new area that the academic world has gotten into it says that we have these judgmental there are a lot of psychological studies with dealing with various biases that people have that we have these biases and the academic world has used it to say okay markets are no longer efficient because people aren't efficient so we're going to use these studies of of inefficiency to figure out how the markets are inefficient the new area now that's not going to work it's not going to be any better than what they did before because what you've got to do is look at how these inefficiencies apply to you when you do that that will there they're studying the right thing but they're studying it in the wrong way yeah well I could probably go on forever about it but I would say the most important I'll give you three number one is they take responsibility for their results these are the common traits of super trader number two they practice all these disciplinary sorts of things in number three they design a system that fits their personality and they simulate it over and over and over again [Music] alright one laughs I'm called a cop we will have out one of these days because I'm requiring our people in our master trader program but we don't have it yeah I'm gonna have a soft world my last volume of my home study course does have the elements of subpoena no it's in my home study course look at my website [Music]

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