Product Description

"The one, only, and by far the best book synthesizing psychology and investing. In addition to providing modern, scientific knowledge about psychology, this book provides a mirror into the mind and wide breadth of knowledge of one of the leading practitioners of brief and effectual cures. Will help to cure your trading and your life."
-Victor Niederhoffer, Chief Speculator, Manchester Investments
Author, The Education of a Speculator and Practical Speculation

"How refreshing! A book that rises above the old NLP model of the 80's and provides insights on how our relationship with the market is indeed a very personal one. Not only has Steenbarger provided some fantastic tools for the trader to transform his mindset, but he has contributed unique trading ideas as well. Brilliant!"
-Linda Raschke, President, LBRGroup, Inc.

"'Investigate, before you invest' was for many years the slogan of the New York Stock Exchange. I always thought a better one would be, 'Investigate YOURSELF, before you invest.' The Psychology of Trading should help you increase your annual investment rate of return. Mandatory reading for anyone intending to earn a livelihood through trading. "
-Yale Hirsch, The Hirsch Organization Inc., Editor, The Stock Trader's Almanac

"This highly readable, highly educational, and highly entertaining book will teach you as much about yourself as about trading. It's Oliver Sacks meets Mr. Market-extraordinary tales of ordinary professionals and individuals with investment disorders, and how they successfully overcame them. It is a must-read both for private investors who have been shell-shocked in the bear market and want to learn how to start again, as well as for pros who seek an extra edge from extra inner knowledge. Steenbarger's personal voyage into the mind of the market is destined to become a classic."
-Jon Markman, Managing Editor, CNBC on MSN Money
Author, Online Investing and Swing Trading

"Dr. Steenbarger's fascinating, highly readable blend of practical insights from his dual careers as a brilliant psychologist and trader will benefit every investor; knowing oneself is as important as knowing the market."
-Laurel Kenner, CNBC.com Columnist, Author, Practical Speculation

Product Details

• Amazon Sales Rank: #26161 in Books
• Published on: 2002-12-23
• Original language: English
• Number of items: 1
• Binding: Hardcover
• 330 pages

From the Inside Flap
Behavior is patterned. Beginning with this premise, noted clinical psychologist and active trader Dr. Brett Steenbarger opens the therapist’s door, demonstrating how traders can identify, interrupt, and change the problem patterns that interfere with successful trading. In The Psychology of Trading, Dr. Steenbarger draws upon real-life case studies and offers hands-on techniques for emotional change to assist traders in becoming their own therapists. Themes that set The Psychology of Trading apart include:

• "Trading from the couch" by utilizing emotions as valuable market data
• Identifying and building solution patterns that capture hidden trading expertise
• Techniques for assessing and trading against the emotions of market participants
• Methods for building focus and concentration for more automatic and trustworthy trading decisions
• Creating shifts in states of consciousness to rapidly exit anxious, impulsive, depressed, and guilty frames of mind

In an engaging manner that provides practical solutions to real trading problems, Dr. Steenbarger walks you through the most common cognitive and emotional tendencies that distort efforts at identifying and trading market patterns. He then describes specific skills derived from years of brief therapy practice to help you become an effective observer of these tendencies and gain control over them. By blending state-of-the-art research from psychology and cognitive neuroscience with detailed case studies, The Psychology of Trading provides you with the intellectual and emotional ammunition to face yourself and transform your approach to risk and reward.

From the Back Cover
"The one, only, and by far the best book synthesizing psychology and investing. In addition to providing modern, scientific knowledge about psychology, this book provides a mirror into the mind and wide breadth of knowledge of one of the leading practitioners of brief and effectual cures. Will help to cure your trading and your life."
–Victor Niederhoffer, Chief Speculator, Manchester Investments
Author, The Education of a Speculator and Practical Speculation

"How refreshing! A book that rises above the old NLP model of the 80’s and provides insights on how our relationship with the market is indeed a very personal one. Not only has Steenbarger provided some fantastic tools for the trader to transform his mindset, but he has contributed unique trading ideas as well. Brilliant!"
–Linda Raschke, President, LBRGroup, Inc.

"‘Investigate, before you invest’ was for many years the slogan of the New York Stock Exchange. I always thought a better one would be, ‘Investigate YOURSELF, before you invest.’ The Psychology of Trading should help you increase your annual investment rate of return. Mandatory reading for anyone intending to earn a livelihood through trading. "
–Yale Hirsch, The Hirsch Organization Inc., Editor, The Stock Trader’s Almanac

"This highly readable, highly educational, and highly entertaining book will teach you as much about yourself as about trading. It’s Oliver Sacks meets Mr. Market–extraordinary tales of ordinary professionals and individuals with investment disorders, and how they successfully overcame them. It is a must-read both for private investors who have been shell-shocked in the bear market and want to learn how to start again, as well as for pros who seek an extra edge from extra inner knowledge. Steenbarger’s personal voyage into the mind of the market is destined to become a classic."
–Jon Markman, Managing Editor, CNBC on MSN Money
Author, Online Investing and Swing Trading

"Dr. Steenbarger’s fascinating, highly readable blend of practical insights from his dual careers as a brilliant psychologist and trader will benefit every investor; knowing oneself is as important as knowing the market."
–Laurel Kenner, CNBC.com Columnist, Author, Practical Speculation

About the Author
BRETT N. STEENBARGER, PhD, is Associate Professor of Psychiatry and Behavioral Sciences at SUNY Upstate Medical University in Syracuse, New York, where he also serves as the Director of Student Counseling. Dr. Steenbarger has published over fifty peer-reviewed journal articles and book chapters on topics related to brief therapy, including standard reference entries in The Psychologist's Desk Reference and the Encyclopedia of Psychotherapy. He teaches techniques of counseling and psychotherapy to graduate students in counseling, doctoral students in clinical psychology, and residents in psychiatry. An active trader who conducts his own statistical market modeling research, Dr. Steenbarger has written feature columns for MSN's money site (www.MoneyCentral.com), many of which are archived at www.greatspeculations.com.

Customer Reviews

Great Book, definitely worthy of 5 stars
This is a fantastic book and anyone thinking of buying it should definitely listen to some of the points in this review.

First off, this book and its insights are very well thought out. You get the sense that this author is not some hot shot. He is a down to earth human and it is easy to emphasize with him in many of his stories of emotional swings in the market.

The author is able to take the psychology of trading and apply it to the real world. All too often new traders think of trading as one thing and life as another. As someone who has been on this path for awhile, things begin to merge as you find that your problems in life carry over to your problems in trading, and to be a good trader for long periods of time, you must also be good at living well in general.

I have read reviews complaining about the stories and their relevance. There is a inkling of truth to these statements, but they usually come from readers who are not well experienced in the markets. This book is very subtle in its own way and many of its pearls of wisdom are not "smack you in the face" statements. This book is definitely not for those who are brand new to trading because they will not have the experience that lets them understand how the stories this author tells are relevant to his trading.

So what is the use of this book if you have to already know what he is talking about to read it? Well the author definitely puts things that are already deeply understood into new context. Putting this market wisdom in new ways is always a great way to solidify your mental structure and sometimes be able to apply it outside of your previous focus.

All in all, I would tell any trader that they have to have this book on their shelf, but that it is a book to be read many times, chapter by chapter, not all at once. Like Market Wizards, Disciplined trader, or Rem. of a stock operator, this book requires patience and an understanding of subtlety. You will get new insights every time you leaf through it.

Concerning his last chapter and sometimes throughout the book, he is definitely on the leading edge of where trading is going. Before computers became very powerful, most good traders needed implicit knowledge and experience to trade. Now that computers have taken over quite a bit of the playing field with Quant funds and technical analysis, sometimes this old "seat of the pants" trading is called undisciplined hogwash. However, the best traders will be able to use the new psychological information about instinct, combined with the technology and discipline of systems, to become proverbial Michael Jordans of Trading. Very very interesting stuff.

Overrated
I bought this book for the good reviews here, and the endorsement by Neiderhoffer, and Rashke. I found out that Neiderhoffer is a friend of the author, and Rashke was a consultant to him. The numerous positive reviews, I'm not sure where they came from...

This author spends several pages at a time telling someone's story, some patient of his that had a problem, his analysis of the problem, and a comparison between that and a trader. I read the preface, introduction all the way up to page 11 of the first chapter, and could not go on. First we encounter Sue, a colored woman from the inner city, raised by her grandma, her only person she could trust. Finally, her grandma dies and Sue goes off and gets pregnant and drops out of medical school. Then we get the "grand revelation" that traders get distraught when they lose money as well.

Then we get to the next patient, who says psychologists are worthless, a failure, etc., etc., and the author says "I agree!" You see the patient was expecting the psychologist to become defensive, but instead, the psyhologist used reverse psychology.

The author, without discussing trading minsdest or strategy, continues by saying: "To be a good therapist, I had to be aware of my natural reaction so I could react in the OPPOSITE way. If I had shown him that I was miffed, I would have fallen into the same trap as everyone else, isolating him and destroying all hope for our work.
Know what you're feeling and go the opposite way. Successful traders and therapists both learn to do what comes unnaturally."

Does he expand on doing what comes unnaturally? Not really, just more about Sue and a sentence about not jumping into trends along with everybody else, but waiting, waiting, waiting for the trend to end.

If you find this valuable, be my guest. I get the impression the author is a novice to trading and is doing his best to curve completely irrelevant stories to trading principles. Principles that may or may not be wrong. For example, if you are a TREND TRADER, you re not going to "continue waiting for trends to end" to enter a trade.

Totally useless book.

great book
all of the above positive reviews are applicable.

You can not start day/swing/option trading without understanding yourself, fear and greed.

Dr Brett will move you into action to become move familiar with yourself