Mental Ceilings and self fulfilling prophesies
- Thread starter Girlpower
- Start date
Hi everyone.
Before anything gets out of hand and an argument brews up, can we please all agree on certain points and set them aside.
the points are these.
1 Any profitable result over the long term is desirable and good.
2 1 point of ES on a daily return average over time adds up to a great deal of money and a very good living indeed.
3 Being consistently profitable over time is far from average, especially since the average return in trading is to lose consistently over time.
4 Different people are at different levels in both their skill and ability.
5 Just because one person can not achieve something, it does not mean that everyone can not achieve it.
6 There is always more to learn.
7 It is always possible to improve.
8 The worst of traders can learn from the best, but so also can even the very best learn from even the very worst and everyone in between can all learn something from eachother. Everyone can learn something from everyone else, since nobody can possible know everything there is to know.
9 It is better to help eachother than fight eachother or pour scorn on either reults, ambition or achievement. (be those things at the high end or low end of the scale)
10 Being open minded at all times is where improvement and forward movement is born, whilst closed mindedness achieves little of value or substance.
Hopefully everyone can agree this and we can all move onwards in good atmosphere of mutual respect and learning.
Many thanks
Natalie
Before anything gets out of hand and an argument brews up, can we please all agree on certain points and set them aside.
the points are these.
1 Any profitable result over the long term is desirable and good.
2 1 point of ES on a daily return average over time adds up to a great deal of money and a very good living indeed.
3 Being consistently profitable over time is far from average, especially since the average return in trading is to lose consistently over time.
4 Different people are at different levels in both their skill and ability.
5 Just because one person can not achieve something, it does not mean that everyone can not achieve it.
6 There is always more to learn.
7 It is always possible to improve.
8 The worst of traders can learn from the best, but so also can even the very best learn from even the very worst and everyone in between can all learn something from eachother. Everyone can learn something from everyone else, since nobody can possible know everything there is to know.
9 It is better to help eachother than fight eachother or pour scorn on either reults, ambition or achievement. (be those things at the high end or low end of the scale)
10 Being open minded at all times is where improvement and forward movement is born, whilst closed mindedness achieves little of value or substance.
Hopefully everyone can agree this and we can all move onwards in good atmosphere of mutual respect and learning.
Many thanks
Natalie
LOLGP, let me ask you something.
How do you conceptualize of this "ceiling" you talk about?
I think it is very simple to understand if it was some hurdle that one was trying to overcome during a single event, like making 50 free throws in a row.
Then it would be a case of "damn, made 48 again, just can't seem to get past that level".
However, with averaging 1.5 pts (or whatever, I'll just use that), it's a little different. It would have to be in the context that you've been trading X number of months, you look back at your performance, and, lo and behold, you've been averaging 2pts. (!!! woo hoo!)
Psychologically, I suppose that if a person truly holds a belief that says it is just damn not possible to beat 1.5pt over a "significant" period of time, it is possible that some "self-defeating" or "self-sabotaging" behavior could set in that would create some sort of self-fulfilling prophecy that drives his performance back down.
Personally, I'm skeptical that this is the case.
Firstly, it's usually the present we are concerned with. Ie, when I have my current trade on, I'm most interested in seeing its outcome -- not so much concerned with its impact on the overall, long run, average trading performance; that is something that tends to get considered at other, less frequent, times. So, if trading performance is going to suffer because of an alleged limiting belief, it would have to be affecting the *current* (present) trading performance. But if the state of mind regarding the current trade (the present time) is not concerned with the overall long run average performance (the domain in which the limiting belief lies), then I find it very difficult to see how this limiting belief could affect the current trade.
When you consider that the long run average performance consists of all these separate current performances, if the latter is not being affected, then, ipso facto, neither is the former.
Secondly, I again have to turn to the established trading records we have of the top peforming funds. As they have not managed to achieve returns as high as the 5-6 pt ES/day equivalents, we are left to explain why not. Your suggestion seems to be that it is limiting beliefs and self-fulfilling prophecies at work. Well, I believe it is unlikely, but it is possible. Perhaps, though, it is simply the case that, as we all know, markets change and these traders were not able to adapt so well to the changes, and were thus not able to continue their top notch performance; which, ultimately, simply says that trading at such a level is just one very, very tough gig.
You know, it's one thing to quickly appraise an activity and determine what is *possible* to achieve in that activity and very much another to actually do it. I could look at golf and say, well, it's *possible* to birdie (or better) every hole therefore anybody that doesn't do it simply has a mental block. Maybe that is the case. Maybe that is what some might choose to believe. Personally, I wouldn't. And I don't really think I'm being a defeatist by not believing it, considering that birdieing every second hole is still ONE HELL of a performance. Just like in trading, to average 1.5pt/day is ONE HELL of a performance.
How do you conceptualize of this "ceiling" you talk about?
I think it is very simple to understand if it was some hurdle that one was trying to overcome during a single event, like making 50 free throws in a row.
Then it would be a case of "damn, made 48 again, just can't seem to get past that level".
However, with averaging 1.5 pts (or whatever, I'll just use that), it's a little different. It would have to be in the context that you've been trading X number of months, you look back at your performance, and, lo and behold, you've been averaging 2pts. (!!! woo hoo!)
Psychologically, I suppose that if a person truly holds a belief that says it is just damn not possible to beat 1.5pt over a "significant" period of time, it is possible that some "self-defeating" or "self-sabotaging" behavior could set in that would create some sort of self-fulfilling prophecy that drives his performance back down.
Personally, I'm skeptical that this is the case.
Firstly, it's usually the present we are concerned with. Ie, when I have my current trade on, I'm most interested in seeing its outcome -- not so much concerned with its impact on the overall, long run, average trading performance; that is something that tends to get considered at other, less frequent, times. So, if trading performance is going to suffer because of an alleged limiting belief, it would have to be affecting the *current* (present) trading performance. But if the state of mind regarding the current trade (the present time) is not concerned with the overall long run average performance (the domain in which the limiting belief lies), then I find it very difficult to see how this limiting belief could affect the current trade.
When you consider that the long run average performance consists of all these separate current performances, if the latter is not being affected, then, ipso facto, neither is the former.
Secondly, I again have to turn to the established trading records we have of the top peforming funds. As they have not managed to achieve returns as high as the 5-6 pt ES/day equivalents, we are left to explain why not. Your suggestion seems to be that it is limiting beliefs and self-fulfilling prophecies at work. Well, I believe it is unlikely, but it is possible. Perhaps, though, it is simply the case that, as we all know, markets change and these traders were not able to adapt so well to the changes, and were thus not able to continue their top notch performance; which, ultimately, simply says that trading at such a level is just one very, very tough gig.
You know, it's one thing to quickly appraise an activity and determine what is *possible* to achieve in that activity and very much another to actually do it. I could look at golf and say, well, it's *possible* to birdie (or better) every hole therefore anybody that doesn't do it simply has a mental block. Maybe that is the case. Maybe that is what some might choose to believe. Personally, I wouldn't. And I don't really think I'm being a defeatist by not believing it, considering that birdieing every second hole is still ONE HELL of a performance. Just like in trading, to average 1.5pt/day is ONE HELL of a performance.
Hi Alfonso,
I think you have just touched very neatly on where I started from, and it does run into the question of what is actually mechanically possible (and that includes taking into account liquidity issues at the very highest ends such as large hedge funds - something which was touched upon as in creting their own internal limitting market by having toal domination of the instrument, and so being self-defeating) down to intermediate and lower levels.
There is always going to be a clear mechanical cut off point, be it 5m? 50m? 500m? 5bn? 50bn? or even just 500k? where the mechanics completely collapse. This has been spoken of in other posts in this thread. so taking the results of a hedge fund who operate beyond the bounds of the liquidity the market has to offer as an example is a great example of the limiting factors in the pure mechanics of doing it.
It also deals with the infinitely compounding question, simply because in the same way the hedge fund model has problems with liquidity that seriously limit possible mechanical returns so does the infinitely compounding model have the same problems.
At other levels though that operate within the bounds of liquity available, and especially where there is a direct correlation between the trader and beneficial owner of the returns, I do wonder greatly whether the ceiling is actually mechanical, or is more attributable to opportunity exploitation/lack of, which may come from self sabotaging tendencies as you suggest (Mr Subliminal raised this point very early on in the thread) is possible, or that techniques to exploit opportunities have not yet been developed or refined to an increasingly higher level, as has been amply demonstrated by Bubba7 in his response to those who use single fixed semi mechanical methods.
Which then comes back to does performance end up where it is due to limiting beliefs with possible self sabotage (maybe taking trades that are 'suspect' and so increasing losing trades, or simply passing on others that would have been big winners) and so forth.
I suspect that self sabotage does not necessarily mean setting out to lose, but more can mean throttling back, taking risks that would not have been taken otherwise, taking time out, letting things go by instead of being alert and focused to catching them, and all manner of other things that I'm sure others could add to the list. These would be psychologically based (again coming back to Mr Subliminal's post). Then there are other social factors that may be at work, again these are dealt with in another thread very ably, where background is one thing cited as a possible problem - That thread was about fear of success if you would like to reference it.
So, You have very eloquently re-posed the very question that this thread was founded on, and which I doubt any of us could truly answer other than through deep personal soul searching for ourselves.
So I apologize that I can not directly answer your question, but merely point you to some possible causes, (which you have already shown you are aware of anyway
) and it takes us straight back to the very same conundrum. Best
Natalie
I would say this is the key point of this thread, if I am correct.
Once again the process and its aim (end-results) should be much more important than the words involved.
It would be possible that a competent trader preparing/expecting merely 1 point may constantly catch 3 points; whereas another competent trader preparing/expecting 5 points may mostly catch 1 point.
Perhaps there are still some other aspects, in addition to all others already mentioned in this thread, we should also pay much attention to, I would just think.
