Daily Speculations
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James Sogi
Philosopher, Juris Doctor, surfer, trader, investor, musician, black belt, sailor, semi-centenarian. He lives on the mountain in Kona, Hawaii, with his family. |
5/9/5
Anxiety and Joy: In Search of
Market Enlightenment
The Art of Speculation and the practice of other types of business engagement utilize different parts of the brain. In fact, the art of speculation itself requires use of different parts of the brain at different times, and hence its difficulty.
Speculation has kind of a meditative flavor of relaxed concentration, with a passive and receptive aspect to it. It requires being "in tune" and playing along with the market, and when a play is spotted, only then is affirmative action required. The receptive mode seems to use a different part of the mind and brain than the part when the bid or offer is made or the decision to sell. When the setup or overlay spot arises, a whole new part of the mind has to kick in to enter or exit the position. Once the position is in place a different part of the mind has to kick in, the active mind needs to kick back, and let the position ride.
When the trading day ends and the lights camera and phone get reconnected, and action starts, a whole new part of the brain, that has been dormant during the trading day, comes to life. After the market closes business demands require attention, and action. It requires a mental phase shift to make the transition, and those of you who engage in other activities in addition to speculation experience this.
This hypothesis would explain the barriers to transition skills from other jobs/professions/businesses into trading. It might also explain the difficulties and or training needed to jump from entering a position to monitoring the position. And the transition from the trading day to the business world or even the difficulties of day trading. In pondering these matters, as invariably happens, an article in Sundays NY Time popped up. As with the Buddhist monks who with 10,000 hours of meditation have altered the physical structure of the brain to a relaxed consciousness, the trader with 10,000 hours of screen time may develop the neural pathways to quickly and smoothly jump from the entry mode to 'ride' mode. 10,000 hours of screen time is 5.7 years of market watching -- and as is the case with many vocational trades, professions, or sports -- the approximate time to achieve a master's ticket. Perhaps there is a key here to market enlightenment.
NY Times May 8, 2005
By JIM HOLT (excerpts only) In the current issue of Nature Neuroscience, however, Frank Tong, a cognitive neuroscientist at Vanderbilt University, and Yukiyasu Kamitani, a researcher in Japan, announced that they had discovered a way of tweaking the brain-scanning technique to get a richer picture of the brain's activity. Now it is possible to infer what tiny groups of neurons are up to, not just larger areas of the brain. The implications are a little astonishing. Using the scanner, Tong could tell which of two visual patterns his subjects were focusing on -- in effect, reading their minds. In an experiment carried out by another research team, the scanner detected visual information in the brains of subjects even though, owing to a trick of the experiment, they themselves were not aware of what they had seen.
It may not come as a great surprise that interaction with the environment can alter our mental architecture. But there is also accumulating evidence that the brain can change autonomously, in response to its own internal signals. Last year, Tibetan Buddhist monks, with the encouragement of the Dalai Lama, submitted to functional magnetic resonance imaging as they practiced ''compassion meditation,'' which is aimed at achieving a mental state of pure loving kindness toward all beings. The brain scans showed only a slight effect in novice meditators. But for monks who had spent more than 10,000 hours in meditation, the differences in brain function were striking. Activity in the left prefrontal cortex, the locus of joy, overwhelmed activity in the right prefrontal cortex, the locus of anxiety. Activity was also heightened in the areas of the brain that direct planned motion, ''as if the monks' brains were itching to go to the aid of those in distress,'' Sharon Begley reported in The Wall Street Journal. All of which suggests, say the scientists who carried out the scans, that ''the resting state of the brain may be altered by long-term meditative practice.''
Each side of the brain seemed to have its own awareness, as if there were two selves occupying the same head. (One patient's left hand seemed somewhat hostile to the patient's wife, suggesting that the right hemisphere was not fond of her.) Ordinarily, the two selves got along admirably, falling asleep and waking up at the same time and successfully performing activities that required bilateral coordination, like swimming and playing the piano. Nevertheless, as laboratory tests showed, they lived in ever so slightly different sensory worlds.
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