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jasont

Therapy For Performance Anxiety

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Hi Guys,

 

I know there was a thread similar to this about a year ago but wanted to get some thoughts or peoples experiences in the area. I have heard that some big institutions use therapists as coaches at times with their fund managers, similar to what Brett Steenbarger appears to do.

 

I personally perform better when I trade simulation as opposed to my live account. I use the same trading plan for both but it seems I am willing to take my signals more confidently in the simulation account. This type of thing is commonly known as performance anxiety, placing pressure upon oneself greater than necessary. Many may be able to remember a time when they placed a great deal of pressure on themselves be it in sports finals, school/college/university exams or even stage performances.

 

I was hoping some people may have used therapy to help their trading in such ways and could share their experiences. I know it is a very personal area to share and understand if those who have done so would not like it to be public domain. I personally am looking into it right now as I will do whatever it takes to bridge that gap which prevents me from being more profitable in my trading.

 

So is there anyone out there that can share their experiences with therapy that helped their trading in any form?

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Hi jasont,

 

Im not against therapy or seeking for professional help. But for a personal advice, all you need now is more experience. You need to practice, practice, practice on a live account. This is the only way to learn in my opinion... and the only way one will improve his emotional state while trading. The more times you place yourself in a emotional state AND practice on controlling it.... the better off you will be. I truly believe it is those who are constantly in an emotional state but unable to control or even apply the discipline to emotions are the ones constantly losing... knowing what is wrong with them but yet still unable to do anything about it. At this point, the trader needs to: A. Quit B. Seek help

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Couldn't agree more.

 

I think the single biggest advantage a trader at a firm has over an independent trader is the sampling rate.

 

New traders get shown basically to just spin their wheels as much as they want/can. Hundreds of trades a day.

 

The whole point of it is so it becomes complete instinct to click the button when you see an opportunity.

 

Brett Steenbarger discussed this concept comparing it to the Military and training soldiers to fire weapons rain, hail or shine.

 

It doesn't matter if you're up ten grand or 5 ticks from your daily loss limit: 1. see opportunity. 2. Click button.

 

Practice in all trading scenario's is what builds that.

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This to me is why its a shame that no software has a paper trader that randomly switches you between live trading and the simulator at some user specified %, but you don't know until after the trade if it was real or not.

To me that would be the ideal way to do things starting off because there is the dichotomy between getting the practice/sample size and your account blowing out starting out.

 

Maybe you could try a strict regimine of 1 live trade then 1 in the simulator until the gap closes between the two?

 

Or maybe try taking your average number of trades over a certain time period and divide by 2 or 4 and that is the number of live trades you have to make and your done, abandon the simulator.

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Thanks for the great replies guys. I agree with all of you in the regard that the best form of desensitization is more live trades. It is the best way to get used to being in and out of trades.

 

I currently have moved to trading my long trades live and short trades simulation. The reason being that I have a 70% win rate with long trades and a 30% win rate with short trades. Weird I know but I'm using the simulation account to find out the problem.

 

I'm not constantly losing, I am actually doing ok. I believe the problem is the emphasis I place on the trades which has a deeper association with past issues I don't seem to be able to look at objectionably. I'm not looking for someone to wave a magic wand and remove excessive emotions from trading. I'm more so looking for someone to help me understand where it's coming from and have ways to manage it over time.

 

In all honesty if I was trading without the association to my trading account I would be doing much better. I would love to trade in a prop firm with a massive sampling rate. It would make the process develop a lot quicker without the consequences associated with ones own account. Not to mention retail commissions.

 

Darthtrader2.0 that would be a very good function to a trading platform. I have often thought it would be good to trade the simulation account but it really trades your live account. Of course it would be a detriment to those who don't take simulation trading seriously but they would choose it anyway.

 

I have tried switching from simulation to live and back etc however the results are always the same. I hesitate on the live trades but take the trades as I switch to simulation.

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At the end of the day, as an independent you have it a lot harder. We all know trading isn't easy, so I think you need to just hit the problem head on.

 

What specifically is the problem, generally it's either a) hesitation (entries) or b) fear (exits - getting out way too early).

 

The best solution is to just practice the activity live, with real money, over and over.

 

If you're struggling to really 'enforce' the motion in the futures, switch to the lowest leverage, lowest size vehicle you can (e.g. 50 share minimum trade size in stocks) and practice the task.

 

Allocate a day to focusing on just your problem.

 

E.g. Hesitation when selling the market. Just spend all day doing that activity.

 

As dumb as it sounds, it will have an impact. Most people just can't be bothered doing it.

 

Ironically, you often find you even end up on the day, with such a simple, mindless strategy ("Sell every few moments, get out immediately").

 

Just trade the smallest share size, and take 1 tick losses / profits. Comiss. might hurt, depending. Just grind out the activity of hitting the trigger to sell.

 

If it's holding on as a problem, then just practice getting in a trade, and holding for X minutes (e.g. 5 minutes) regardless. This is where it's obviously key to do the smallest, low leverage possible. On 50 - 100 shares, you can't do much damage.

 

It might cost you a few hundred, but how much are you losing from missed opportunity each day? Probably more. Up to you, own circumstances, etc.

 

Food for thought.

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Hi Guys,

 

I know there was a thread similar to this about a year ago but wanted to get some thoughts or peoples experiences in the area. I have heard that some big institutions use therapists as coaches at times with their fund managers, similar to what Brett Steenbarger appears to do.

 

I personally perform better when I trade simulation as opposed to my live account. I use the same trading plan for both but it seems I am willing to take my signals more confidently in the simulation account. This type of thing is commonly known as performance anxiety, placing pressure upon oneself greater than necessary. Many may be able to remember a time when they placed a great deal of pressure on themselves be it in sports finals, school/college/university exams or even stage performances.

 

I was hoping some people may have used therapy to help their trading in such ways and could share their experiences. I know it is a very personal area to share and understand if those who have done so would not like it to be public domain. I personally am looking into it right now as I will do whatever it takes to bridge that gap which prevents me from being more profitable in my trading.

 

So is there anyone out there that can share their experiences with therapy that helped their trading in any form?

 

Hi Jasont,

 

I think Soultrader is right, you want to be sure that your concern is performance based and not due to a lack of trading skill. If you are lacking the appropriate skill set, then trading will naturally produce anxiety. Hone your skills and the anxiety should become a non-issue.

 

Note also that you don't necessarily need psychotherapy. If anxiety were affecting your life in many different areas (not just when you put on a trade), you might have a clinical issue you would want to deal with. If, for example, anxiety were affecting your ability to have a close relationship, hold down a job, and participate in everyday recreational activities (i.e., you could identify anxiety as significantly restricting your life), then you probably have a problem and would want to seek professional help. On the other hand, performance anxiety not due to lack of trading skill could be helped by a person skilled in human performance psychology (trading psychologist).

 

If you decide you would benefit from a performance psychologist, there are a few things you might want to consider. First, they should understand a little about trading. They don't have to trade, but must at least be familiar with the context and what a trader is likely to experience, including some of the recent work related to individual traders in behavioral finance. Otherwise, you are not going to be communicating well with one another and you will spend a lot of time educating him or her in the issues of trading.

 

The psychologist should also understand how to help with performance issues. When you really think about it, there are only three areas in which a psychologist can be of true help to a trader (or athlete, musician, or other elite performer). They can best help a trader in the psychological side of 1) how they prepare for trading, 2) how they execute and manage trades, and 3) how they deal with their results to understand strengths and current limitations and develop strategies for further improvement. Now, admittedly, these are broad areas, but if you were interviewing a psychologist, this is the kind of framework you would be looking for.

 

You should also be aware that there has been almost a seismic shift in psychology over the last decade or so. Approaches and techniques thought to be valid only a few years ago are now viewed as less effective. New approaches supported by a strong line of research focus on mindfulness, acceptance of emotion (rather than attempting to control or avoid it), and other experiential methods rather than disputing thoughts or endlessly processing emotions. This is being applied both in clinical and in performance psychologies with very positive results. Unfortunately, many do not keep up with the literature or orient themselves to a non-empirically based form of psychology and are unaware of the significant new advances.

 

You should also check out credentials and be comfortable with those. It is sad, but true that there is a lot of snake oil selling out there. Finally, the job of a good trading psychologist, in part, is to help you develop the knowledge, skills, and abilities to become your own trading psychologist. You don't want to become dependent; you want to be taught how to self-adjust.

 

Hope this is helpful,

 

Eiger

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Thanks for the excellent responses guys.

 

For the moment the problem appears to be entries. I can see the market setting up well within my signals yet sometimes I just leave it too long to enter when I know I should have entered already.

 

The strangest part is that I have a relatively low risk amount per trade. In fact I recently had a spate of 14 losers out of 18 trades yet my account drawdown was 5.5%. In my opinion that is a pretty good result. Now when I am in losing trades it doesn't appear so much to be the money factor that gets me peeved. In fact whenever I take a loss I have a feeling of "whatever" about the money side but get frustrated at myself for not identifying reasons I should have been out earlier or not been in the trade at all. Sometimes the old impulse trade hits me because a few moves earlier I missed a good trade due to hesitation.

 

Maybe it is my impatience kicking in here. SMW the idea about entering and exiting for a day to get used to the process is a good idea. I'll have some deep thought about that one and assess the options with it. With brokerage included it would probably be cheaper to do it with the ES than stocks.

 

Eiger thankyou for the time you took to write that excellent post. I have spent a lot of trying to figure out if it was my plan or if it was performance based. The fact that the simulation account always without fail brings a better result leads me to believe there is something in the gap between my mindset whilst trading live and simulation.

 

You have given some great advice in finding the right psychologist to help me with my trading should I take that road. I can see where having to educate a non trading psychologist in the area of trading would become a problem. The three areas of things to outline when interviewing a psychologist to help me with my trading are fantastic and will be on the top of the list if I interview some.

 

You bring up some great points about the changes in the psychology industry. It is extremely important that they are on track with advances in psychology and also aware of how it affects performance based activities. The best point you made was that I don't want to become dependent on the psychologist and that I need to be developing the skill to assess myself. I couldn't agree more.

 

So does this mean that no one has actually used therapy for performance anxiety or any other part of their trading around here? I thought it may have been a popular area for people to look considering so much has been unveiled in the world of psychology in trading. Just look at the fact we have a Psychology part of the forum. It doesn't seem to be only directed toward the market Psychology either.

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Hi everyone,

 

I’m not sure about therapy but what are your thoughts on mental rehearsal for an hour a day. Seeing your body taking action on clicking the mouse following your system and strategies. Doing the same tasks over and over in your mind in several different market scenarios.

 

It is true that our brains cant tell a real experienced from an imaged one. Our brains simply release the exact same chemicals as if the experience is actually happening. But actually practicing in live in real-time and mentally rehearsing over time we should gain the discipline were looking for. At least that’s what I’m thinking!!

 

I’ve been M/R for only a few days so far and they say it takes at least 30days straight for the new neural pathways to begin to build in our brains. So I’ll let you know how it goes.

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I think one of the issues is that many starting traders have pretty small accounts. This make 'firing blanks' (paper trading) appealing if you haven't got much live ammo. Spread betting or CFD's might be helpful in this case as this allows you to trade (well its really betting) smaller size. I think this is one of the reasons that retail forex is gaining in popularity. Of course you mst remember that the outfits that offer these products are bookies and there are a bunch of issues that this introduces but it does allow practice with real, albeit small amounts of money.

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