Unconscious Vs Conscious Competence

[karoshiman 10]

This whole discussion reminds me of my beginnings in this business. Well at the beginning it was no real business... I trade full-time and intraday now only for about a year. But I do have experience in swing trading since the mid-nineties. The reason I have so much trust in my intuition is that I started my swing trading at that time on no particular system... I took trades based on my gut feeling only! I had just some moving averages on my charts and watched price action (something I would not recommend to do... unless you have enough money to lose ). When prices "felt" high I went short and when they "felt" low I went long... :doh: lol

 

But I've lost a tremendous amount of money until I've developed that intuition. I.e. you don't need the 10,000 hours of practice if you lose a lot of money as your brain makes you learn faster... so that you get not broke... :o

[roztom 10]

Isn't that dependent on what each individual trader has on its screen and is used to look at for 10,000 hours? Otherwise you could not have developed such intuition in the first place.

 

QUOTE]

 

The unconscious side, I suspect is responding to what is not on the screen, other than possibly price, or speed of a rejection or a one-tick of a low, or a fast Algo pop or stop raid..the stuff you recognize which might create opportunity but does not necessarily fit into a structured set up...but that is also random...

 

I think one of the major items is detecting a trend change early enough to avoid taking the wrong side and also to try to get aligned with it as soon as possible... We all see this happening in the short timeframe but it all happens from the bottom up and not the top down timeframe-wise..so can the "unconscious competent" take action off the shorter timeframe to either avoid a loss or capitalize on an opportunity before the "conscious competent" recognizes it?

 

BTW: I am taking Excedin now - I'm getting brain damage here myself.. :crap:

 

I truly appreciate everyones input. This is not the lightest topic we typically discuss..

Edited March 25, 2012 by roztom

[CYP 10]

 

BTW: I am taking Excedin now - I'm getting brain damage here myself.. :crap:

 

I truly appreciate everyones input. This is not the lightest topic we typically discuss..

 

Tom - I'm sorry to say this, but I had a stroke after reading the first page of this thread...Excedrin is not going to help me. If someone could call the paramedics, I'd appreciate it...

 

All this talk of intuition, ego, conscious/subconscious competence/incompetence, etc. is making me thirsty...so I think I'll go have a few beers and see if I can get my consciousness to be one with my subconsciousness, in order to get a better idea of what's going on with the markets...hopefully, it doesn't take me to all the way to unconsciousness...

 

CYP

[roztom 10]

Tom - I'm sorry to say this, but I had a stroke after reading the first page of this thread...Excedrin is not going to help me. If someone could call the paramedics, I'd appreciate it...

 

All this talk of intuition, ego, conscious/subconscious competence/incompetence, etc. is making me thirsty...so I think I'll go have a few beers and see if I can get my consciousness to be one with my subconsciousness, in order to get a better idea of what's going on with the markets...hopefully, it doesn't take me to all the way to unconsciousness...

 

CYP

 

:haha: I'll join you...

 

This is an interesting topic IMHO.. (not the beers)

 

I think some of the great traders, just like great athletes, have integrated these competencies...

 

In my case I do like structure, it lays off the decision-making, at least to a point, to a replicable process.

 

I hope we will get some more insights here on this.. it is not a light topic but then neither is high-yield trading...

[MightyMouse 12]

:haha: I'll join you...

 

This is an interesting topic IMHO.. (not the beers)

 

I think some of the great traders, just like great athletes, have integrated these competencies...

 

In my case I do like structure, it lays off the decision-making, at least to a point, to a replicable process.

 

I hope we will get some more insights here on this.. it is not a light topic but then neither is high-yield trading...

 

When you have a few beers, you'll definite get more intuitive.

 

How many times have you taken a trade based on intuition that worked?

How many times have you taken a trade based on intuition that did not work?

[roztom 10]

When you have a few beers, you'll definite get more intuitive.

 

How many times have you taken a trade based on intuition that worked?

How many times have you taken a trade based on intuition that did not work?

 

I can't answer that.. I personally have no quantifiable data...

 

I'm really trying to get a feel on how others have integrated it or deal with the potential conflicts that those 2 parts of the mind create... also if that "unconscious competence" is an asset to be harvested or an obstacle that creates conflict...

 

I hope we might hear some more about this..appreciate your participation...

[MightyMouse 12]

I can't answer that.. I personally have no quantifiable data...

 

I'm really trying to get a feel on how others have integrated it or deal with the potential conflicts that those 2 parts of the mind create... also if that "unconscious competence" is an asset to be harvested or an obstacle that creates conflict...

 

I hope we might hear some more about this..appreciate your participation...

 

if you have no quantifiable data, then why would you think that you might want to harvest it?

[TheNegotiator 13]

I think the idea of conscious and subconscious understanding of the market is a very useful one potentially. I like karoshiman's idea about taking trades with his gut too. Sometimes those can pay big. Just like how we try to allign ourselves with the market ebb and flow, alligning our conscious and subconscious at the same time is when things really can start to click.

 

A simple suggestion maybe Tom is to consciously take account of this subconscious feeling when you are considering a trade. Just like price action around your entry, it could be used as a variable to decide whether or not to take the trade at all. You could even say, size your position differently based on this feeling. In thiss case it might have been that you note the feeling consciously then maybe trade half of your standard clip. Just an idea.

[SIUYA 11]

I had seen this article before and it is sort of topical here.

 

Chances Are - NYTimes.com

 

There are a lot of similar articles and tests around that have shown that our intuition and feelings around anything to do with probability are generally quite poor, even when we are a supposed expert.

 

So even if your intuition is telling you something, unless the accuracy of your intuition is properly historically measured then you might still be kidding yourself relying on it.

So unless the facts bear out that you should trust your intuition and change/modify your plan then you should ignore the intuition - or at least adopt a way to incorporate it w=so that at least it does no harm.

[roztom 10]

if you have no quantifiable data, then why would you think that you might want to harvest it?

 

I think top performers in any highly competitive endeavor have this skill integrated and they perform at a higher level because of it...

 

My interest in the topic from my perspective is that I recognize this element in myself but most of the time my need for discipline discounts it.. often I have glimpses of "brillance" but I have trained myself not to be influenced by this "unconscious competence" for the sake of consistency - (tough enough on its own).

 

I think we all have this skill to one extent or the other (as someone referenced earlier like riding a bike), assuming, we are past the rookie phase and have enough time under our belts to recognize the repetitive market behavior that is nuance driven and cannot be put in a black & white structured context.

 

I am going to try to let more of this in to my trading on a "conscious level" if I can.. though it is somewhat in conflict with my discipline or at least try to note what flashes in my mind - if I can.

 

I am very interested if others have looked at this area of their trading.. and either managed any conflict it might create, just ignore it or more importantly integrated it and use it to perfom at higher levels and yield. If so, can we learn to capitalize on it - and what steps did they use to accomplish it?

 

If you think about Floor Traders - they operate often at this level. I see what they do as more of a "contact sport" then us... We typically have more time to react..We can plan our trades. They are order flow/news driven and we are more price driven. They just "go" - that requires "unconscious competence" since they are "in the moment."

[karoshiman 10]

Hi Tom,

 

As you mentioned top performing athletes it came to my mind that I've read already a good book on this subject:

 

Finding Your Zone: Ten Core Lessons for Achieving Peak Performance in Sports and Life by Michael Lardon

 

I think 'Being in the Zone' describes this state of mind you are referring to pretty well.

 

The guy is a sport psychologist who has trained many well known athletes (with a strong focus on golf). Anyway, the methods are applicable to any endeavor in your life but you have to be open-minded to make use of it.

 

I haven't tested all of the ten lessons for a longer period of time, to be honest, but some of them. All in all it gives you a better understanding of how you function in stressful situations (a golf tournament with $$$ on the line is also pretty stressful if this is your only income) and how to perform better in these.

 

k

[SIUYA 11]

The sports analogy is always interesting. There are a lot of similarities to trading in some respects

It is often forgotten however that many of these top sports people have the advantages of full time coaches, statistical measures of their past and competitors performances, and a raw natural talent to begin with.

 

A friend of mine was great mates with a top professional golfer who often said his intuition (and maybe this was not the right word, but the point is the same) caused him problems. He used to often "go for shots" when his ability said that they were of low probability to work....fantastic if they did, you looked like a legend. He struggled when he played like this, but the thing was, once he stopped this, stuck to what he did well, and knew he did well, he went back to making money on the tour.

 

While often its the size of our account (risk of ruin) more than the raw talent that is the difference between using the intuition or not, often we have to play within our limitations of comfortable risk.....????

[zdo 20]

Greetings: Thanks for visiting this thread.

 

I hope you will share some of what you have learned about yourself and how you deal with the 2 sides of your trading mind.

 

This actually relates to the conflict between the intuitive self and our pragmatic self the real world educated self (life, school, socialization, family, etc..) and the trading self..

 

I am not a psycologist but an experienced discretionary trader..

 

I have experienced something over and over and I am wondering if this happens to you and if so what have you done as a solution.

 

Here's what happens to me: I look at a market or whatever, my mind pops with what I see, it is a confluence of charts, technicals, over 30yrs experience, screen time and last nights pasta..

 

I sense what is likely to happen and where I should take a trade and/or exit.... Quite often I am right on the button..

 

HOWEVER, when things get going my logical non-intuitive self can take over, move a stop, dump a good position. I become UNCONSCIOUS of what I had thought before..like it never happened... I can become myopic at times..this costs me...

 

I write down what I intuitively see but often it is in front of me and I no longer see it... My conscious brain has overridden the intuitive..

 

Somehow they need to co-exist but they often don't...

 

Any of you have this conflict and if so how have you successfully or unsuccessfully tried to manage it..?

 

Thanks for your time and consideration..this might require some "thought."

 

roztom, just some thoughts for you... and also approaching the limits of language comm btw

 

Have you questioned your use of the word “conflict”?. There is no conflict betwn them. "conflict " is never an issue. Separation and loss of unity is the issue.

All the experience of “conflict” occurs only in the "conscious brain" side as a result of the rending /separation

 

Conscious competence comes from working to be focused progressively through the key aspects of a repetitive task on as many of your attempts at the activity as is possible. Selective practice, etc...

UnConscious competence naturally and automatically develops as neurology grooves what to do. … btw As outcomes of activites become less and less ‘newtonian’ (like driving) and more uncertain / randomlike (like trading), it is increasingly difficult for uncon competence to emerge and be sustained because the ‘prediction and control’ links btwn perceptions and instrumental acts are not as solidly reliable… but

 

Applying any willpower to the process of developing unconscious competence will actually impede it.

Any judging will maintain the separation and divide and destroy the natural trust / union btwn them… and …Behind judging is the mistaken assumption that the whole is here to serve the "conscious brain" side. Judging is the apparently ‘easy’ way that leads to depletion ('gut' connections become tenuous and unreliable, etc… ultimately adrenal fatigue, etc. ) instead of the much preferred ‘flow’ / being pretty much on a roll all the time…( something most people / traders don’t even believe is possible, btw)

 

The whole does not exist to support the conscious mind. The whole is there to support the whole. The best role the conscious part can assume is to 1) nonjudgmentally and as accurately as possible ‘re-create’ its representation of reality for the whole to utilize in its 'work' and 2) to simply focus on what needs to be focused on in the moment. The whole is more than adequately intelligent and can handle the ‘choices’ too. The whole system / the uncon is already ‘unconsciously competent’ at handling most every activity. It can handle more – much more. The trouble begins and continues when the conscious / ego attempts to appropriate roles it was never ‘created’ to do…

 

One possible path - develop "conscious competence" in real time mindful awareness practice of simply being aware of when and how you are ‘judging’ . Example: note the difference between your thinking and inner content when you are just observing reality as best you can - and then when you are critically noting what you did wrong (as traders are likely to do on losing trades or as an acct bal drops, etc.)… Example: note when you are in effect ‘choosing what is chosen’ instead of attempting to control ...

What are your alternatives to 'judging'?

How deeply habitual is it ? ie

How unconsciously competent are you at it?

hth

 

 

.

 

 

 

barely, really really barely, related… but interesting…

How to Think Like a Mad Man, Find your Edge & Risk Little for Lots - Gresham's Law

Edited March 26, 2012 by zdo

[roztom 10]

The whole does not exist to support the conscious mind. The whole is there to support the whole. The best role the conscious part can assume is to 1) nonjudgmentally and as accurately as possible ‘re-create’ its representation of reality for the whole to utilize in its 'work' and 2) to simply focus on what needs to be focused on in the moment. The whole is more than adequately intelligent and can handle the ‘choices’ too. The whole system / the uncon is already ‘unconsciously competent’ at handling most every activity. It can handle more – much more. The trouble begins and continues when the conscious / ego attempts to appropriate roles it was never ‘created’ to do…

 

.

 

barely, really really barely, related… but interesting…

How to Think Like a Mad Man, Find your Edge & Risk Little for Lots - Gresham's Law

 

Thanks for the post. Can you comment on what is the basis for this...

[MightyMouse 12]

Unconscious competence is a term that is more appropriately applied to something like driving, music, or sports. It really does not have a place in trading since trading progress and excellence is very difficult to measure and it is unclear that it can be measured at all.

 

What a lot of us do is assign our winning trades that were done spontaneously, to some stroke of intuitive brilliance, and our spontaneous mistakes to something else.

[zdo 20]

Can you comment on what is the basis for this...

 

not exactly sure what you mean by "basis"

… it was just some thoughts… not the fkn be all to end all answer

if I'm paraphrasing someone can't reference it at the moment...

… anyways, further reading would most likely be a misstep… a hindrance…

 

:haha: maybe I was just looking at the venerable, trusted, old, reliable authority -

the tao jones average ???

 

all the best

[roztom 10]

Unconscious competence is a term that is more appropriately applied to something like driving, music, or sports. It really does not have a place in trading since trading progress and excellence is very difficult to measure and it is unclear that it can be measured at all.

 

What a lot of us do is assign our winning trades that were done spontaneously, to some stroke of intuitive brilliance, and our spontaneous mistakes to something else.

 

No disagreement, This is comment is also a general response in addition to MM..

 

A fighter pilot must juggle an infinite number of variables which are not repetitive..Trading also has variables that are unique to the situation.. however, both skills have repetitive responses with variable inputs...

 

Can the "unconscious competent/intuitive" side process these variables and come to a rapid conclusion - in the moment and take action vs a conscious process that most likely takes longer.. ?

 

In the case of an athlete, fighter pilot or trader, I suspect if the intuitive process could be actually developed to a higher level of function it would give the trader a signifigent advantage over other competitors just like it does for other high competence activities...

 

I believe those with time and success under their belts, to varying degrees possess this.. Question is: Can it be recognized? Can it be developed and harnessed? Can it be quantified?

 

Think about when you are long and you see price moving up and get banged at a high... you might not necessarily wait for an indicator to cross - maybe you do if that is your plan..but if you see the force of the rejection..if you just hit the exit button.. it is reflexive - a response to experience, intuition, unconscious competence... (hopefully).

 

How often do you just click the button without all the squiggles to support it? How often do you put a position on without "confirmation"?

 

Isn't that part of the "unconscious competence/intuition" at work.. ?

[roztom 10]

not exactly sure what you mean by "basis"

… it was just some thoughts… not the fkn be all to end all answer

if I'm paraphrasing someone can't reference it at the moment...

… anyways, further reading would most likely be a misstep… a hindrance…

 

:haha: maybe I was just looking at the venerable, trusted, old, reliable authority -

the tao jones average ???

 

all the best

 

I found your previous response most interesting. The point I was making about the "unconscious competence" was how to get it to not be in conflict with the "conscious competence" - the need to follow structure or decision making matrix.

 

The "unconscious competent" sees it all in the collective moment while the "conscious competent" may operate a slower/lower level decision making process..

[SIUYA 11]

A fighter pilot must juggle an infinite number of variables which are not repetitive..Trading also has variables that are unique to the situation.. however, both skills have repetitive responses with variable inputs...

 

i guess a fighter pilot in the heat of a battle is more akin to a trader, whereas a sportsperson has rules that apply to the game.

However, if you are taking the idea or experience and muscle memory to another level then maybe its as simple as a survivorship bias - those that survive seem to survive because of some innate ability whereas others dont. Some are lucky for a time, others are not.

 

Remember in the back of the market wizards book there was a trader who did not want to be named as some decisions where made using zen mastery or such (cant remember the details).

Given a lot of things can be tested historically then to a certain extent we should not be worried and just go on testing, however if being discretionary then already you are applying some sort of muscle memory already. If there are more concerns about the "conflict" then I still think that it becomes an attempt to try and extract too much from a situation.

 

If in your example you bang something out at a high, then it can certainly be quantified, and either as a back tested result, OR if you really wish to see if your trading can be improved, forward testing live time by recording thoughts and actions. There is not much more than that....its a measure of measurement, otherwise you are really just being even more subjective by saying it just works....in which case all the squiggly lines are never needed....however, and here is the next question that relates to this..... how then do you measure what is skill, technique or just dumb luck. ie; where is the "alpha" - are you better investing in the market and doing something else.??? A whole other kettle of fish, and a question I raised in another thread about outperforming over the long run.

At a guess (and this is a big guess) - is that you can get value out of avoiding marginal trades or not being too greedy when exiting prior to a trigger - ie saving a 5 points when you might have only captured an extra 1 - but thats about it....and even then this should be able to be measured, if you can be bothered.

 

Hindsight gives a wonderful theoretical set of rules, history measures the effectiveness of those rules.

[roztom 10]

i guess a fighter pilot in the heat of a battle is more akin to a trader, whereas a sportsperson has rules that apply to the game.

However, if you are taking the idea or experience and muscle memory to another level then maybe its as simple as a survivorship bias - those that survive seem to survive because of some innate ability whereas others dont. Some are lucky for a time, others are not.

 

 

Given a lot of things can be tested historically then to a certain extent we should not be worried and just go on testing, however if being discretionary then already you are applying some sort of muscle memory already. If there are more concerns about the "conflict" then I still think that it becomes an attempt to try and extract too much from a situation.

 

At a guess (and this is a big guess) - is that you can get value out of avoiding marginal trades or not being too greedy when exiting prior to a trigger - ie saving a 5 points when you might have only captured an extra 1 - but thats about it....and even then this should be able to be measured, if you can be bothered.

 

Hindsight gives a wonderful theoretical set of rules, history measures the effectiveness of those rules.

 

I guess the point here is there is tremendous power in intuitive side of our brains.. Great traders, athletes, fighter pilots, etc - require high level performance in highly stressful, in-the-moment scenarios.

 

Trading often is an in-the-moment process.. with extreme volatility and 2 opposing forces either fighting it out or everybody running to one side of the boat or the other...

 

I know we have our levels, etc that we all watch.. most of us probably, subject to timeframe, are acting off of the same stuff. Indicators, if leaned on, are probably based on the same price based methodology..it is very redundent, IMHO...

 

The variable in this are not the technical tools but the mental process to align whichever tools to the mental state of the individual trader and also the ability to recognize opportunity when it presents itself... In trading, true opportunity doesn't wait too long... that is where the unconscious competence aligns with the conscious... I suspect.

 

Purley mechanical, non-descretionary, rule-based system traders have removed not only descretion but the need for "unconscious competence." Yet, I do not know of ANY system that can outperform a "successful" descretionary trader.

 

Now descretionary does not mean operating without rules or process but the variable of descretion might mean bending the rules or adjusting based on how the market behaves, etc. (all subject to timeframe, etc)

 

Siuya, one of the things you repeat often is to avoid marginal trades.

 

Does your conscious or unconscious competence help you discern the difference? Is it rule based or if you are on a move and it has already moved a high percentage of a daily range is that what you base it on...or is it subtle, rotations, Delta, Retracements, etc, etc... Depending on how you quantify it..it can be either rule based - "Conscious Competence" or subjective - "Unconscious Competence." How do you handle it? Tx

[SIUYA 11]

Siuya, one of the things you repeat often is to avoid marginal trades.

 

Does your conscious or unconscious competence help you discern the difference? Is it rule based or if you are on a move and it has already moved a high percentage of a daily range is that what you base it on...or is it subtle, rotations, Delta, Retracements, etc, etc... Depending on how you quantify it..it can be either rule based - "Conscious Competence" or subjective - "Unconscious Competence." How do you handle it? Tx

 

I would say its the conscious brain that helps discern the difference.

These are trades whereby you can actually look at a chart and say - the trend is down, I should short, BUT its very close to support, its actually just retraced 50-61% of the last move up, its what appears to my eye an abc pattern - so the best thing to do is to wait until a rally to short it rather than shorting it now on momentum.

 

A lot will depend on the instrument and the context of course. eg; are we in 2008 or not, is this a mean reverting instrument like a currency that in % terms does not move that much over the course of a year, unlike an individual stock.

Point is for me - a marginal trade is one that could probably be entered at a more favorable level that just doing it now.

How I handle it is by asking myself simple questions like - "do I need to be in the trade, is there a better opportunity to enter, where will I make the proper money over the course of the week and not immediately" (does not always work and I understand the issues you are talking about)

 

Whereas a friend who has made serious amounts of money trading is ridiculously good at it. When the markets suit him he will switch on, when they dont he switches off....maybe for weeks, months at a time. I cant do that, he can and he is very good at it. In his mind he waits for the right type of market, is prepared to use a lot of leverage and then he becomes completely focused. For him, marginal trades are those whereby the market does not suit him. He handles it by not being focused all the time, whereas his unconscious mind seems to know when to step up - again he is not always right but when he is its scary - when next I see him I will ask him.

[zax1150 10]

Interesting thought but a little far from the mark, Roztom,

this more basic psych, than actual,

 

the extremely bad habit of second guessing yourself & thereby turning a good trade to bad, relates more to personal self confidence than anything else

ie: you knew the position was good when you placed it........then self doubt kicks in :doh:

 

Fairly common mistake I usually tell noobs to try a little hypnotherapy, Paul Mckenna is a good example.....

 

But then I've only been trading 25 years & have psychology as a major so what would I know :missy:

 

I'm sure some armchair trader with weeks of experience will always know better

[bloom48 10]

Be the enemy to yourself very stupid idea. All of the parts of your mind works together to better result. Fight against your fear? Hey guys, may be you will listen why this fear is here and what do you afraid of? Afraid to loose money? Maybe you are afraid that you are not ready? I think it is 90 % of fear than peoples do not ready and habe no knowledges enough to trade. So they began to fear and than began to fught with fear and than they right so stupid articles and sentneces

[Rande Howell 10]

I find that many traders have an intuitive element in their trading mind, but they don't know how to integrate the hunches into their decision making. In this left brain world we certainly are not taught. To the intuitive trader, this element of the mind, I call Creator. You learn to open yourself to the hunches and welcome their appearance -- and they are checked out by the clear thinking (hopefully) of your impartiality. I find this works well when developed. It's simply an attunement that is sharpened by a trained mind.

 

Rande Howell

[zdo 20]

... The point I was making about the "unconscious competence" was how to get it to not be in conflict with the "conscious competence" - the need to follow structure or decision making matrix.

 

..

 

Did you ever consider that if your "unconscious competence" >|: is making ‘uninvited’ attempts to ‘contribute’ that the tasks you’ve set for your "conscious competent" 'side' may be in slight overload or too repetitive ?