Emotions While Trading

[BlowFish 10]

Well I read the paper and I think I was probably right to feel something wasn't quite right about its conclusions. I'm not saying there is not interesting and valuable data there btw.

 

Here's the thing (the way I understand it). In a nutshell they asked people to record there mood using a mood test. (UWIST mood adjective test list). The huge leap is that in the conclusion they have made the assumption that peoples mood is in response to 'monetary gains and losses'. As far as I can see that was not tested for. Hell the sample where paper trading so the mood outcomes could hardly have been in response to monetary gains and losses could it? Or have I just mis understood the test.

 

There is also a strong argument that the samples mood at the end of the day (when results where actually recorded) are effected by performance rather than the other way round. I am not suggesting that is the case but the possibility should not be ignored. You could conclude that people that perform poorly have greater emotional response to there trading? It's a chicken and egg deal.

 

Guess I am just being picky (yeah again) but I think potentially good work is being tarnished here. I would expect more rigour from academics.

Edited November 17, 2008 by BlowFish

[RobinHood 10]

Not sure if this was already covered but something occurred to me tonight.

 

I'm currently working at the casino as a croupier. We are often playing poker and all in all this week I lost half my weeks wages.

 

Anyway, I've noticed that the emotions I feel playing poker are much more intense than the emotions I feel trading. If I could quantify it then I would say a $4000 loss to me is the equivalent of a $150 loss in poker (estimated).

 

On the way home tonight, I first thought maybe its because poker is more personal (face to face), but now I'm quite sure that what was responsible for the difference in emotion was my competence.

 

I'm really not that great at poker, quite a noob. Whereas when I'm trading I will have pre-defined stops and much more experience to go on when placing trades. I am much more able to ascertain whether I was responsible for a loss or it was a "natural" loss due to market ebb and flow.

 

 

Thoughts?

[MightyMouse 12]

Not sure if this was already covered but something occurred to me tonight.

 

I'm currently working at the casino as a croupier. We are often playing poker and all in all this week I lost half my weeks wages.

 

Anyway, I've noticed that the emotions I feel playing poker are much more intense than the emotions I feel trading. If I could quantify it then I would say a $4000 loss to me is the equivalent of a $150 loss in poker (estimated).

 

On the way home tonight, I first thought maybe its because poker is more personal (face to face), but now I'm quite sure that what was responsible for the difference in emotion was my competence.

 

I'm really not that great at poker, quite a noob. Whereas when I'm trading I will have pre-defined stops and much more experience to go on when placing trades. I am much more able to ascertain whether I was responsible for a loss or it was a "natural" loss due to market ebb and flow.

 

 

Thoughts?

 

That is interesting because I have thought of the same thing, but I am more comfortable playing poker than I am trading and I am definitely newer at trading futures than poker. However, my max daily loss trading is the same as the amount I bring to play poker, so, I can't relate to the 4000 and 150 thing.

 

I do get affected by my emotions trading, where it is a battle to keep myself from getting out to early. But, in poker, I only feel elated when I win or pissed that I lost, but that is at the end of the hand. So, you are probably right because before I play poker, I practice until I play the odds as close to flawlessly as possible; therefore, I know for certain that win or lose I played perfect poker.

 

That would be akin to knowing your set ups perfectly and losing on a trade that you would take 1000 times out of 1000 if you saw it that many times and you care less until the end. I am really not there yet with trading.

[MightyMouse 12]

Well I read the paper and I think I was probably right to feel something wasn't quite right about its conclusions. I'm not saying there is not interesting and valuable data there btw.

 

Here's the thing (the way I understand it). In a nutshell they asked people to record there mood using a mood test. (UWIST mood adjective test list). The huge leap is that in the conclusion they have made the assumption that peoples mood is in response to 'monetary gains and losses'. As far as I can see that was not tested for. Hell the sample where paper trading so the mood outcomes could hardly have been in response to monetary gains and losses could it? Or have I just mis understood the test.

 

There is also a strong argument that the samples mood at the end of the day (when results where actually recorded) are effected by performance rather than the other way round. I am not suggesting that is the case but the possibility should not be ignored. You could conclude that people that perform poorly have greater emotional response to there trading? It's a chicken and egg deal.

 

Guess I am just being picky (yeah again) but I think potentially good work is being tarnished here. I would expect more rigour from academics.

 

I agree. paper trading and the real thing are completely different animals. It's like saying you can perfectly describe the taste of orange juice by looking at a picture of it.