Zen and The Art of Trading

M

martys

I am starting a new thread to discuss the book "Zen and the Art of Poker" written by Larry W. Phillips. Some of you might have read my thread on Marty Schwartz where I post highlights on parts of his book "Pit Bull." This is not going to be the same deal. I hope there will be open discussions on the poker rules put out by Larry Phillips for the mutual benefits to our trading. No book report. No money involved. No guruism. No B.S.

POKER RULE #1: Learn to use inaction as a weapon.

I am going to tangent off a little to get the context right. Please be patient.

First what the hell is Zen? I think Buddhism uses many many different words to describe the same thing that is undescribable - our innate natural state of mind. Why is it undescribable? It's nature is beyond the grasp of our conceptual mind yet can be directly experienced. They DO NOT call it a higher conciousness - they call it the ORDINARY consciousness because afterall it is the natural state of mind. When people said they are "touched", often they felt it a little but don't know what to make of it.

A lot of people think Buddhists are pessimists because they talk about impermanence of things and cycles of suffering but to the contrary the main message of Buddhism is that in the expanse of innate wisdom, everybody in nature is already Buddha free from all suffering. We cannot make our Buddha nature better or worse, it is already prefect as it is but the problem is we cannot recognize our own mind's nature. Buddha scriptures explained how we are like people stricken with proverty living in a house not knowing there are measurable treasures buried underneath. The keys to that are limitless (in scope) compassion and wisdom. OK that's enough on Buddhism.

Everybody knows Buddhists practice meditation to enhance their recognition of one's innate wisdom. Actually the practice in general comes in two stage: tranquility meditation and insight meditation. Different lineage traditions have different approaches for the same names. I am not qualified to give any instructions but simple tranquility relaxation exercise cannot be harmful.

A representative meditation of the first stage would be counting one's breath say from 1 to 21 repeatedly. Start off the exercise with the intention to better yourself and others. One can just sit comfortably, straight back, keep relax the arms and legs. You can put the palms of your hands on your knees. Breathe naturally and mentally counting the breath from 1 to 21. You don't need to push thought away. Just simply disengage from the chain of thoughts when you are aware you were distracted by them and go back to the counting. Do that for 5 min, 10 min or longer depends on your personal preference. Do not try to force things to happen. Or expect the practice to turn out one way or the other. More thoughts, less thoughts do not matter. As one of my teachers advised "nothing to do" - just relax and be natural. At the end you can dedicate the merits of the exercise to the freedom from suffering for all beings.

I will not say anything about insight meditation because that one you really need direct personal transmission from a qualified teacher of a "live" lineage. A lot of people confused that tranquility meditation is the Zen. Actually the tranquility practice is simply setting a conducive stage for the recognition of the nature of mind. When the mind is tranquil, it is more "like" its innate state. So I think even though we are a little fall short, with experimenting the counting breath meditation above, we should get a sense of direction.

I think the first POKER RULE # 1 "Learn to use inaction as a weapon" is absolutely utmost important to traders' survival. That is why it is rule #1. Most of the time, market is indeed random, one can only win consistently by avoiding activity most of the time and trade only the few times during the day when a high probability trade occurs. It is our job as a trader to wait more than we trade.
 
privateisland said:

Hi Martys, my sig is from the original book "Zen and the Art of Archery." I read the book when I was 15yr old. I did not understand the true nature much at the time. It's about a German man (if I remember correctly) who goes in search of understanding "Zen".

It relates very much to trading IMO. I think the book you speak of is based on the archery book. It's not at all a "how to" book. Instead it's a book describing how to let go your usual ideas and thoughts and become one with something subconsciously . I think my sig describes it perfectly. You don't think of the target or the arrow. Instead it becomes one with the proper mindset. Thus when you release the arrow, it does not hit the target, but merely blend together as one. Cool stuff.


__________________
"if one really wishes to master an art, technical knowledge of it is not enough. One has to transcend technique so that the art becomes an "artless art" growing out of the Unconscious." DTS 1953
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Anyone who has read Herrigels "Zen in the Art of Archery" would be well served to read the academic review of it (from Japan) ... http://www.nanzan-u.ac.jp/SHUBUNKEN/publications/jjrs/pdf/586.pdf

One interesting review on Amazon said:
I am the translator of the article "The Myth of Zen in the Art of Archery" by professor Yamada Shoji, mentioned upthread by another reviewer. Professor Yamada is an experienced kyudo practitoner. I also have been practicing kyudo for 30 years, 11 of them in Japan under the tutelage of some of the most senior instructors in Japan.

To put it bluntly, Herrigel got everything, and I mean everything, wrong. He himself only practiced kyudo for three years, if his translator Sozo Komachiya is to be believed (he started in 1926 and returned to Germany in 1929). He spoke no Japanese. He was himself a mystic (or he wanted to be one, anyway) intent on understanding Zen, not archery, and he had very definite pre-formed ideas about what he was looking for and what he believed Zen, and, by extension kyudo, to be. Given such a situation, the impending disaster was a forgone conclusion. Even with the best instruction he would not have understood kyudo.

His book is very seductive, filled as it is with tantalizing mystical stories about a seeker on the road to "enlightenment". So, it will appeal to romantics who have no experience in either Zen or kyudo, and it has been my experience that the book indeed appeals primarily to such people. It is instructive to note that those people who have experience in either discipline are quick to point out how thoroughly Herrigel bollixed it up.

I began kyudo under the influence of his book, and it was only after many years that I fully realized exactly how pernicious that influence was. I strongly urge those people who are interested in kyudo to never read it or only to read it after they have been practicing kyudo for a long time under competent instruction. To read it with the intent of forming an informed opinion of kyudo is not only inadvisable, it is positively dangerous.

Read "Kyudo: The Essence and Practice of Japanese Archery" by Onuma and DeProspero instead. It is as good an explanation of kyudo as Herrigel's book is a bad one.
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Kiwi, I read that review awhile ago. To each his own I guess. It seemed to also be written by a man who found a guru of his own (kinda like you and Woddie). So, I got what I like out of it. But, people are all different. So what one person loves, anther will dislike. What one person states is a must, another will state it's not even necessary. It's like martial art styles, trading styles etc. I thought the book was a short, simple and fun book. It's not a bible and anyone who thinks that with it you'll have enlightenment is nuts. If you read it, you will at least understand that true Zen cannot be found in a simple book, but lies in oneself . So I guess it accomplishes that much.
 
Good response privateisland. You might want to read the professors work as well as the Amazon review.

You do make one mistake. I don't regard Woodie as a guru, just another trader who tries to teach some stuff to people and enjoys it. And I don't have the regard for him that I would have for my guru. My spirited defence of Woodie is because:

a) many of the attacks are by folk who are just attacking for the sport (been there) and not because they really know anything about woodie. Many here are just a wee bit nasty and fight for the fun (???) of it ... so am i at times on et ... something in the water here.

b) some are by people who once placed woodie in Guru position and when they failed to succeed blamed it on Woodie.


I like to defend truth particularly when some of the falsehoods are such blatant self deception. Perhaps I am just as much a shxt stirrer as many of the attackers. One of the best posts in the recent threads was by dbPhoenix with whom I war from time to time ... but whos intelligence is sharp ... actually I will quote it for its zen like character :-)

Quote from dbphoenix:

No big deal. I'm pretty weary of this myself. :)

Actually, the what is a pullback what is a trend thing was a feeble attempt at a joke. I continue to be impressed by the ability of beginners and not-so-beginners alike to make complicated what are the simplest concepts imaginable. And yet it goes on.

For a very long time, I held fast to my conviction that the problem was one of simple ignorance, and that if the trader studied hard enough and practiced long enough, he/she would eventually grasp the difference between "up" and "down". Occasionally, this has turned out to be the case. Far more often, however, the trader never gets it, and I'm left with no choice but to assume that most of these people are just plain stupid. Not ignorant. Stupid. Oh yeah, and lazy.

As you know, I'm not a fan of indicators. I really couldn't care less about anything but price. You think that I think that my way is the only way, but that is not the case. Be that as it may, what bothers me most about indicators is that so many people -- as can be witnessed by this and the previous Woodie thread -- expect these indicators to do everything for them from signal their entries and exits to cure their eczema. They haven't the slightest interest in assuming any responsibility whatsoever for their trades, much less their trade management. And as for accountability? Hah!

At least with price alone, one is naked before the buying and selling pressures which move price, and he has few excuses for his own incompetence other than a lack of preparation, which technically is a reason, not an excuse. Granted, some (many) traders who trade price will blame "them" for their own inadequacies, but the rationalizations tend to be fewer amongst price traders.

These Woodie people are just as screwed as the Jack people, and for the same reasons. And as long as they continue to seek the answers outside themselves and relinquish the responsibility for their fortunes to indicators and patterns and systems and gurus and chat rooms and whatever the hell else, they will continued their screwed existence, whining all the way.

An indicator, a pattern, a system, is a tool. A tool does not work. A tool simply is. It is the person who uses the tool who works. If anything doesn't work, it is the person who is supposed to be doing the work, not the tools themselves. To say the (fill in the blank) "doesn't work" is a stupid thing to say.

Stop whining and start doing something with yourselves.
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How is that zen like? Zen requires a great deal of discipline and taking responsibility for ones outcomes (success). Also, Buddha told his followers not to believe anyone (including himself) unless they could test and prove something for themselves.

He might have been a great trader :cool:
 
regarding meditation my guru says:

"an ounce of practise is worth a ton of theory".

it is really amazing how effectively meditation can change ones perception. again and again amazing, amazing, amazing ...


peace
 
Interesting thread.

During any big market, I always find I get totally lost. It's as if there is one big blank period for that day, or part of it. I know I went in to the office at a certain time, but then, at least for a few hours after it's all over, there is just a big hole with nothing in it.

Then for a while, again when it;s all over, it's just like I can't separate myself from the market. It's like the market is this big globe spinning round and round in all different directions and I'm in the middle. But then it's like the globe becomes solid. I am the globe and the globe is me. I am in it, and it is in me. I don't think about putting trades on, they just happen. I don't think where am i going to get out, I just feel my way and the trades just come and go. It's like there are all these rivers of information and they all through through me.


These days don't happen very often, but when they do, it makes trading one of the most beautiful things. It seems the money is just a by product.


hardly the great philiosophy you were probably hoping for, buyt just my sad little effort.

lovely day here.
 
Actually the book is about poker rules with an eastern twist. It is less about Zen. I have not read the archery book. I did study Zen Buddhism a little but I felt it gets a little fuzzy as I get more into it so I ended up with Tibetan Buddhism later in life. Anyway the book is not about altered state of consciousness and I hope Buddhism is not about that to people. Zen, Mahamudra, Great Perfection are more about recognizing the nature of the innate mind... about coming home. Leave the altered state of consciousness to the self-claimed mystics. One of my most repected teacher said "If you see your mind as empty, let it be empty. If you see your mind as full, let it be full." You don't try to alter thing or make believe.

POKER RULE #2: Don't get irritated or angered by long session of folding.

We are all playing probability over a long run. Understand it. Accept it. Mentally prepare for it. Keeping our head makes all the difference. It is on the top of my list.
 
Quote from Everest:

I am the globe and the globe is me. I am in it, and it is in me. I don't think about putting trades on, they just happen. I don't think where am i going to get out, I just feel my way and the trades just come and go. It's like there are all these rivers of information and they all through through me.


These days don't happen very often, but when they do, it makes trading one of the most beautiful things. It seems the money is just a by product.
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This is exactly what the book is about. Wonderfull to hear that ppl really experience this 'flow' in trading. I personally have only experienced slight tastes of it. At these moments you're not worried or happy about directional moves, they're just there, like the waves in the sea.

The 'flow' happens with ppl that are good AND experienced in their job and as far as I heard from friends it can be experienced in all kinds of jobs, artists doing a new painting and having it finished in the middle of the night; or computer programmers developing a big application module in one 24-hour run, with hardly any bugs in them.

If it happens to you I think it is safe to say you found your talent.

Ursa..
 
Typo in my first post:

"Buddhist scriptures explained how we are like people stricken with proverty living in a house not knowing there are immeasurable treasures buried underneath."

Everest, thank you for sharing. As Ursa mentioned, I think they have a book on this type of peak performance experience - the Flow.

Is Flow Zen? I think we probably have to include everything - the Good, the Bad, the Ugly, Moral, Immoral are all Zen. A Buddhist principle like Mahamudra ("the Great Seal of a King") is really all prevasive because mind is all prevasive. We filter our world perceptions with our concepts, which is very useful in our day to day activities but the appearance and conceptual imputations are different from how things really are.

POKER RULE #3: If you've been folding a lot, for a long time in the game, and you're starting to think that maybe it's time you got in and played a few hands again -- that's not a good enough reason. Keep folding.

Don't worry too much about missing a play. Any one trade sequence is not supposed to make or break our trading career. But not waiting for the high probability setup will put us against the law of large number which is ALL WE HAVE - then we are really all alone in Vegas.
 
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