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Trading in the Zone - Mark Douglas
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Trading in the Zone - Mark Douglas

  #11 (permalink)
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I have started reading BigMikes "Daily Coach" recommendation. A superficial comparison: more practical and exercise oriented than Douglas, similar themes and market wisdom as Douglas, delivered more as mantra and repetition, smaller practical details and specific strategies to use a thai expression: same same, but different.

Trading in the Zone has detailed concepts with extensive explanations, as does this book - but less practical - Quick summation: I am enjoying them both!

Reading both and finding the shared wisdom can only help to reinforce the necessary aspects of being a consistently successful trader.

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  #12 (permalink)
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Perhaps a more general discussion of psychological approaches and viewpoints is warranted. Sticking just to Mark Douglas for the time being...

I initially found MD very illuminating - I've read TITZ and Disciplined Trader many times each, literally 8-10 times for TITZ. I think MD does an excellent job of presenting most of the viewpoint a consistent trader needs to have. However, I think MD is limited in that his psychological approach best serves those who view trading as a statistical/probabilistic math problem. I don't want to voice an opinion whether this is right/wrong because opinions differ and aspects of both are correct. But I think that in discussing psychological coaches it is fruitful to make distinctions between coaches that help you adjust your psychology to a given approach vs. psychologists who help you work on yourself regardless of the philosophical approach you are using. I would classify MD as a psych coach who will help you adjust your viewpoint/mindset towards using a statistical/probabilistic approach. I would classify Brett Steenbarger as a more "all-around" psych coach. He believes strongly in the statistical/probabilistic approach but he offers a lot of practical knowledge in the "achievement" and "performance" categories.

One psych coach not mentioned is Ari Kiev. I don't want to derail the thread, but Ari is very good and focuses on the personal aspect in most of his books (Trading to Win is the exception). However, I would caution that Ari's coaching is most useful for those that approach trading as a performance discipline which involves building conviction in trade ideas based on skill/experience/focus.

thanks for the thread!

Seek freedom and become captive of your desires. Seek discipline and find your liberty. - Frank Herbert
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@Surly - very astute observation. I hadn't realized that before (I've read both authors' works), but I agree.

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Surly View Post
Perhaps a more general discussion of psychological approaches and viewpoints is warranted. Sticking just to Mark Douglas for the time being...

I initially found MD very illuminating - I've read TITZ and Disciplined Trader many times each, literally 8-10 times for TITZ. I think MD does an excellent job of presenting most of the viewpoint a consistent trader needs to have. However, I think MD is limited in that his psychological approach best serves those who view trading as a statistical/probabilistic math problem. I don't want to voice an opinion whether this is right/wrong because opinions differ and aspects of both are correct. But I think that in discussing psychological coaches it is fruitful to make distinctions between coaches that help you adjust your psychology to a given approach vs. psychologists who help you work on yourself regardless of the philosophical approach you are using. I would classify MD as a psych coach who will help you adjust your viewpoint/mindset towards using a statistical/probabilistic approach. I would classify Brett Steenbarger as a more "all-around" psych coach. He believes strongly in the statistical/probabilistic approach but he offers a lot of practical knowledge in the "achievement" and "performance" categories.

One psych coach not mentioned is Ari Kiev. I don't want to derail the thread, but Ari is very good and focuses on the personal aspect in most of his books (Trading to Win is the exception). However, I would caution that Ari's coaching is most useful for those that approach trading as a performance discipline which involves building conviction in trade ideas based on skill/experience/focus.

thanks for the thread!

I agree they are both very good for different reasons.

"The day I became a winning trader was the day it became boring. Daily losses no longer bother me and daily wins no longer excited me. Took years of pain and busting a few accounts before finally got my mind right. I survived the darkness within and now just chillax and let my black box do the work."
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Quotes that I enjoyed

I just finished reading Trading in the Zone. I need to take the book back to the library, and I wanted to get a few ideas down for reference. I figure here is as good a place as any.

CH1
Ninety-five percent of the trading errors you are likely to make—causing the money to just evaporate
before your eyes—will stem from your attitudes about being wrong, losing money, missing out, and
leaving money on the table. What I call the four primary trading fears.

CH3
Taking responsibility means believing that all of your outcomes are self-generated; that your results are based on your interpretations of market information, the decisions you make and the actions you take as a result. Taking anything less than complete responsibility sets up two major psychological obstacles that will block your success. First, you will establish an adversarial relationship with the market that takes you out of the constant flow of opportunities. Second, you will mislead yourself into believing that your trading problems and lack of success can be rectified through market analysis.

CH4
If your goal is to trade like a professional and be a consistent winner, then you must start from the premise that the solutions are in your mind and not in the market.

CH7
A probabilistic mind-set pertaining to trading consists of five fundamental truths.
1. Anything can happen.
2. You don't need to know what is going to happen next in order to make money.
3. There is a random distribution between wins and losses for any given set of variables that define an edge.
4. An edge is nothing more than an indication of a higher probability of one thing happening over another.
5. Every moment in the market is unique.

If you really believe in an uncertain outcome, then you also have to expect that virtually anything can happen. Otherwise, the moment you let your mind hold onto the notion that you know, you stop taking all of the unknown variables into consideration. Your mind won't let you have it both ways. If you believe you know something, the moment is no longer unique. If the moment isn't unique, then everything is known or knowable; that is, there's nothing not to know. However, the moment you stop factoring in what you don't or can't know about the situation instead of being available to perceive what the market is offering, you make yourself susceptible to all of the typical trading errors.

CH8
On the other hand, if you believe that all you need to know is:
1. the odds are in your favor before you put on a trade;
2. how much it's going to cost to find out if the trade is going to work;
3. you don't need to know what's going to happen next to make money on that trade; and
4. anything can happen;
Then how can the market make you wrong?

CH11
I AM A CONSISTENT WINNER BECAUSE:
1. I objectively identify my edges.
2. I predefine the risk of every trade.
3. I completely accept risk or I am willing to let go of the trade.
4. I act on my edges without reservation or hesitation.
5. I pay myself as the market makes money available to me.
6. I continually monitor my susceptibility for making errors.
7. I understand the absolute necessity of these principles of consistent success and, therefore, I
never violate them.


Last edited by bijeremiad; September 1st, 2012 at 05:48 PM. Reason: added two quotes
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MD The Doctor

I Heard MD in Vegas last year and I have also read his book. He asked the class a question. "Is trading Gambling?"
I was really suprised to hear most of the class said No. It is not gambling. The most popular reason why they said no was because as traders we a defined edge.
Marks point was while that may be true... trading is still Gambling because you never know if you are going to be a winner or a loser. We are playing the odds. The difference between the people on the slot machines and us traders is.... when we put on a trade we do not always accept the loss. The slot machine players accept the loss.

As a matter of fact as a write this post I am down 6 tics and I do not think I will be a winner on this trade. Although when I took it.. I had great faith in my edge and the probability it was a winner.

Well It just took me out. 8 FDAX Points in the hole.

So I turn and look at the overall odds of this trade.... Yuup! Still looks good and Yuuuup i would take that trade again and again.

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"Train yourself to let go of everything you fear to lose."
-Yoda, Star Wars Episode III Revenge of the Sith
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These videos are from an interview about the seminar Mark did for Wisetrade.

I've seen this seminar.

If this is your style, few do a better job than mark.

He has a way of keeping things simple and to the point.

Rejoice in the Thunderstorms of Life . . .
Knowing it's not about Clouds or Wind. . .
But Learning to Dance in the Rain ! ! !
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MD vids

Pure gold, thanks^2 for posting these.

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I find the content of his books superb, however the way/style which he has written them makes for a difficult read.

I always thought the books could be made better if they were re-written by a professional writer as Douglas certainly isn't one.

Still brilliant though in my opinion...

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