General discussion : Betfair trading made simple - Part 5 "Why always me?"

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JollyGreen
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Sat Aug 31, 2013 10:02 am

So why do we fly into a rage, why do we get so upset by an error or a loss? Why do some people seem unflappable whereas others lose it in a flash?

The brain isn't great at multi-tasking, as people we struggle to truly multi-task. Who remembers the old pat your head rub your stomach routine? At first it seems impossible but as you practice it opens the pathways in the brain and you can do it. The brain for all its complexities tends to work in a straightforward manner and uses a hierarchy system. I don’t want to go into left brain versus right brain as the following explanation should negate the need for that part of the debate.

So the brain splits functions into hierarchy. The highest or first level is where functions like breathing, heart rate, sleep/wake, balance are stored. You do not think about these things, they are known as unconscious competence. Let’s face it we’d all struggle if we had to keep reminding ourselves, breathe, stand up, heart beat!! So these functions are Level 1 and they just happen. If you want to understand unconscious competence a bit more then Google “Adult Learning Model”

This is where a potential problem can occur. As mentioned, we also find unconscious competence stored in level 1 brain function. We use this to achieve high level performance in our trading. It is also used for driving a car, playing golf etc. You may hear it referred to as muscle memory – it’s not quite the same if we want to be picky but it is near enough. The good traders just click and seem to do it without thinking; they make it look easy!

How many times have you watched a sports event on TV and heard the words “I just froze” or “they choked” in relation to a failure? That missed putt or a missed penalty, the list is endless! Well freezing or choking is what happens when you lose high level brain function. It happens to everyone including world class athletes and sportsmen/women so you’re not alone. The difference between the elite sports person and the rest is very small and it is all contained in the space between their ears.

In level 2 of brain function we find emotions and level 3 contains mental functions like, perception, planning, thought and very importantly emotional control! Now here’s the important bit;

“If your emotional systems gets overloaded it will shut down higher level brain function”

So that is why you lose control, it cannot be helped as you are hard-wired this way after thousands of years of evolution. It is often referred to as the “fight or flight” mechanism. This is good news because it means you are not alone and you CAN adjust this mechanism provided you can admit the problem and recognise what makes it happen.

So again, I ask you to think about what causes you to lose control because it is unique to you. It cannot be the actual loss that causes it because we’d all be losing control, it is emotion and the level of that emotion that causes it.

In the next post I will start with strategies to help you prevent the loss of control.

Tradertrician
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Sat Aug 31, 2013 10:57 am

So basically, if a trader can learn to keep emotion under control there's a very good chance everything else should fall into place?

I have mentioned before that I have mastered keeping my emotions under control after a loss which stops me chasing losses and the way I learned to do this was way before trading came into my life. Everybody has to deal with negative stuff in their lives which causes them to worry, it can be really life changing things like relationship breakdowns or losing loved ones through death or everyday stuff like money troubles, paying bills etc, the list is endless.

In my early 20s I used to worry about everything, I would lay awake at night worrying about stuff and it used to drive me mad but over time I realised that allowing yourself to worry couldn't possibly change a thing in a positive way, it could only make the situation worse by making you feel worse inside.

My method is, firstly you cant stop the worry existing, its impossible but you can stop yourself worrying by removing it from the foreground of your thoughts and how I do this is to basically when I start to feel myself worrying about something I tell myself, thinking about this will only make it worse, it cant possibly make it better so I need to stop and then I place that thought into a box if you like, close the lid and put it to the back of my mind and it works, I stop thinking about it, which stops me worrying. I will give you an example I'm dealing with right now, my Mum was diagnosed with cancer in June, wont go into details but its very uncertain what the outlook is but I can honestly say I have managed to stop myself worrying about it coz I know it will change nothing, all I can do is deal or face up to stuff if and when things happen.

So when I lose money and the emotions start to come flooding into my mind of I need to try to get that money back, I simply just box that thought away.

However, what I am struggling with and it's because I'm still using small stakes is, when a trade goes wrong, instead of cutting my losses and getting out I have got into the habit of thinking, oh well it's only a few quid I may as well let the bet run and obviously nearly every time the whole stake is lost. I know I wouldn't do this using large stakes so I need to cut this bad habit out.

What I am going to try to do is when I get these thoughts of may as well let it run, I am going to try to teach myself to box these thoughts away too, allowing logical thoughts saying 'GET OUT' to be at the foreground of my mind.

I have always been a bit odd in the way I go about thinking about things, I don't necessarily believe what it says on the tin if you know what I mean. If somebody laid a box down with the word 'Apples' written on the side and asked what is inside, most people would say apples, personally I would want to take a look inside before answering coz there may well be oranges in there.

Does any of this make any sense AG?

Again great stuff mate, looking forward to the next installment :)

Tradertrician
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Sat Aug 31, 2013 11:01 am

Does any of this make any sense AG?
Sorry, meant JG!

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JollyGreen
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Sat Aug 31, 2013 11:39 am

Tradertrician wrote:
Does any of this make any sense AG?
Sorry, meant JG!
It makes sense but you actually need to change your thought process. If you have a potentially worrying thought as you mentioned then just putting it to the back of your mind won't work....as such! It is a tricky area so let me try and offer a brief explanation.

The mind is powerful, very powerful but it is also very basic in its operation. If I say to you "Don't think about a dolphin" the first thing you do is think about a dolphin! So if you have something in the back of your mind then it can and will affect you. I will try and explain in the next post how to deal with emotion using a system to improve your threshold. You need some emotion to function but not so much that you lose control

Tradertrician
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Sat Aug 31, 2013 12:00 pm

Ok thanks JG

Interesting stuff, look forward to reading more later.

Paul

Stanman
Posts: 31
Joined: Sun Jul 04, 2010 1:29 pm

Sat Aug 31, 2013 1:28 pm

I think my thought processes are affected by my genes. My maternal grandfather did not drink but liked a flutter, my paternal grandad was a bookie in a room behing the pub. I see red and take it as a personal insult. Perhaps if I can change the actual colour from red I might not be so blinded. Can it be done?

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JollyGreen
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Sat Aug 31, 2013 1:31 pm

Stanman wrote:I think my thought processes are affected by my genes. My maternal grandfather did not drink but liked a flutter, my paternal grandad was a bookie in a room behing the pub. I see red and take it as a personal insult. Perhaps if I can change the actual colour from red I might not be so blinded. Can it be done?
Most definitely Yes! It just requires the correct method applied. I am hoping to discuss the "how to" in a later post.

steven1976
Posts: 1743
Joined: Tue Jan 19, 2010 6:28 am

Sun Sep 01, 2013 4:23 am

Hi Jolly,
Im loving the posts, it must take a good bit of time for you to put them together each day and therefore just a little thanks. Would be nice if you put them on a blog somewhere as well as they may get lost in the forum threads for newbies in the future or even a Jolly Section on BA for your tips and advice.

As well as a "how to" post would it be possible to do a "why to get involved". I don't mean, tell us what exactly what you do but I would imagine there are a number of people that trade say for example a horse around 10's. It appears that a lot of activity has traded around 10's and the money has never broken through say 10.5. However, when they enter it seems to shoot out beyond their money and they sit and expect the price to come back in but in reality this horse doesn't have that good of a chance to win.

I presume, you mainly look for value by doing your homework and knowing good horses and how they will run. I'd imagine their are many people like me that don't know this value and therefore it could be an interesting post if it isn't already part of your "how to" post to include a "why something is value"

ste

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JollyGreen
Posts: 2011
Joined: Sat Mar 21, 2009 10:06 am

Sun Sep 01, 2013 10:54 am

steven1976 wrote:Hi Jolly,
Im loving the posts,

I presume, you mainly look for value by doing your homework and knowing good horses and how they will run. I'd imagine their are many people like me that don't know this value and therefore it could be an interesting post if it isn't already part of your "how to" post to include a "why something is value"

ste
The fact you enjoy the posts means a lot to me so thank you for taking the time to say so.

You might be surprised to know that I don't often study a race in terms of form, breeding, etc prior to any trading I might do. I will study if I am looking to take on a short priced favourite. That usually occurs when I glance at the cards and see a crazy price or listen to the hype from so called experts on TV, in particular the Mourning Line.

I think Peter is going to add these posts to his blog so they remain available. I will also ask about a special section on the forum where they can be made into stickies.

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CaerMyrddin
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Joined: Mon Sep 07, 2009 10:47 am

Sun Sep 01, 2013 11:48 am

I start to feel myself worrying about something I tell myself, thinking about this will only make it worse, it cant possibly make it better so I need to stop and then I place that thought into a box if you like, close the lid and put it to the back of my mind and it works
Hi mate, imho you shouldn't do this as your thoughts will eventually emerge from the depths of your mind.

Personally I always try to tidy up any loose ends. Whatever it is, first thought is 'What can I do about it?' If the answer is nothing, accept and move on. If you can do something about it, within your means, well, do it then!

Procrastination will only make your problems look worse and will eventually become worse.

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