Do you have trading nightmares?

Ask the Dream Doctor : Warning Sign

Will one anxious trader heed his nightmares’ lessons?

By: Doug Donaldson
Trader Daily, April/May 2007
www.traderdaily.com

Dear Dream Doctor: I’m a currency trader plagued by this recurring dream: I’m concerned that I haven’t put a stop on my positions. Then the market makes a series of huge moves, both up and down. I’m alternately euphoric and devastated. When I awake in real life, the markets are flat; my positions have experienced only minor fluctuations overnight. Yet the intense swings of my dream have left me exhausted. What’s going on? ”” Devon, New York

Big bets before bedtime have caused traders to lose sleep for generations, Devon, and dreams like this are common among them ”” just ask your friends. They can, however, be turned to your advantage.

This dream is an indicator of unpreparedness ”” it might be about your specific positions, and it might be about market volatility. But ask yourself this: Is this dream really about trading, or am I neglecting some other, more important goal in my life?

The anxiety you feel is surely tied to something else weighing heavily upon you. Consider this dream a vivid sign detailing both the risks of being unprepared and the rewards that come from taking care of business. Valuable goals are clearly at stake here, Devon ”” will you heed the warning?

You’ll notice, I suspect, that this dream occurs only when you’re feeling adrift. Think of it as a cue to take care of unfinished business where you feel exposed and vulnerable, in the markets or in life itself. Do so and you’ll soon begin to sleep easy ”” as easy, at any rate, as a trader possibly can.

Charles McPhee (dreamdoctor.com) is the author of Ask the Dream Doctor.
E-mail dreams to mcphee@ dreamdoctor.com.

Re: Do you have trading nightmares ?

I dont have trading nightmare.
Though i do have dreams.
The other day i dreamed that EVE went into a trading halt, opened at $1.68 and then shortly after it was trading at $2.40
More recently, i dreamed that MPO went upto 78c.
LOL!

This is a bit off the topic but funny. Last night I dreamed that Phillip Ruddock was personally doing my tax return! He hasn't even featured in the news in the last few days, my tax return has been done and the tax paid.
I have had dreams about ZFX when I was undecided what to do with it.

Julia said:

This is a bit off the topic but funny. Last night I dreamed that Phillip Ruddock was personally doing my tax return! He hasn't even featured in the news in the last few days, my tax return has been done and the tax paid.
I have had dreams about ZFX when I was undecided what to do with it.

Click to expand...

Hi Julia,

Now that's a real nightmare. Considering Phillip Ruddock's history he probably messed up your tax return. LOL! He's certainly not one of the most likeable ministers going around.

Q & A with trading coach Denise K Shull

http://blog.stocktickr.com/2007/05/02/interview-with-denise-k-shull/

Totally off-topic, I dreamt last night that I slept in until 1:30pm (UNHEARD OF!) and missed my 11am appointment to pickup my new car! It's taken 10 years to get this car...NIGHTMARE!

theasxgorilla said:

Totally off-topic, I dreamt last night that I slept in until 1:30pm (UNHEARD OF!) and missed my 11am appointment to pickup my new car! It's taken 10 years to get this car...NIGHTMARE!

Click to expand...

Ten years? What sort of car is it?

Q & A with trading coach John Forman

http://blog.stocktickr.com/2007/05/15/interview-with-john-forman-trading-coach/

Attribution and bias among traders

http://traderfeed.blogspot.com/2007/06/attribution-and-bias-among-traders-in.html

No nightmares just happy dreams every financial year

For the prevention of trading nightmares consider using this new tool for investors:

www.marketsimplified.com

Here is some good help

http://www.inc.com/magazine/20050801/blogs.html

I dream that I sit in front of the computer, in nothing but my underwear looking at little red and green numbers.























Hang on a minute....... :

Tough times for short-sellers

http://www.businessweek.com/magazine/content/07_30/b4043078.htm?campaign_id=rss_daily

The Hypochondriac Market

http://www.ftportfolios.com/Commentary/EconomicResearch/2007/7/25/The_Hypochondriac_Market

Philip Bowring hits hard

http://www.asiasentinel.com/index.php?option=com_content&task=view&id=627&Itemid=35

Do you have trading nightmares?

I've had a few nightmare trades, does that count?

August 16, 2007

The 10% Solution
By David Gaffen / WSJ

If the accepted definition of a market correction is a 10% decline from a previous top, well, it looks as if the word can finally be used. Those who had forgotten what the meaning of “correction” meant aren’t to be faulted, as it’s been more than four years since the last one.

The S&P 500, unless it closes above 1397, will have dropped 10% for the first time since March 2003, which makes 1,651 calendar days between 10% declines, according to Schaeffer’s Investment Research. That’s the third-longest streak without such a retreat since 1970, with the longest streak taking place between 1990 and 1997.

Meanwhile, around the world, most of the major indexes have dropped at least 10% from their closing highs, leaving most of them in the red for the year, even after strong gains through the first several months of 2007.

Index Change Since Peak
Mexico IPC -15.7%
CAC 40 -14.6%
U.K. FTSE 100 -12.7%
Hang Seng -11.9%
ASX200 -11.7% (as of today, 17 August)
Nikkei -11.1%
Xetra Dax -9.9%


Among the worst performers of late: Mexico’s IPC Index, which has shed nearly 16% from its peak on July 6, but is still up 3.3% on the year. China’s Shanghai B Index is off 14% from peaking on May 21, but the ridiculous advance in China earlier this year still has that index up a massive 141%. The Nikkei 225 is the true laggard; it has lost 11.6% since topping out on July 9, and is now 6.3% lower than at the beginning of the year.

The Things That Are Keeping Risk Managers Up at Night

Author: Lenny Broytman
Date: 2007-08-23


The ever-changing forefront of risk management is constantly changing and Harvard Business School says that the two primary challenges regulatory authorities are now facing need to be dealt with “forcefully” in order for international finance to forge ahead.

The ever-changing forefront of risk management is constantly changing and Harvard Business School says that the two primary challenges regulatory authorities are now facing need to be dealt with “forcefully” in order for international finance to forge ahead.
Firstly, the Ivy League business school insists that an increasing portion of the market is currently being overseen by regulatory authorities that are simply not qualified to handle the responsibility. The second major challenge revolves around the political world and the way that it has infiltrated all of the major administrations.

The Harvard article also dove into the discussion surrounding the proliferation of derivative products and the extent to which they have aided banks in better managing their balance sheets. With the added benefit of what some are calling “credit risk transfer” technology, many of the nation’s largest banks are able to hedge and shift various risk factors, lowering their chances of financial mishap.

A lot of the focus on the aforementioned has managed to take some heat off of exactly where that transferred risk has ended up and why. Many in the industry are witnessing the risk being borne by investors who, in the past, have had limited experience with complex derivative products. These new investors, which include both public and private pension funds alike, view the products primarily as a means to gain higher yields for themselves.

This mass of new investors bring two vital things to the table. First, many of them depend on external risk assessments and don’t really place too much emphasis on outside opinion. The other important thing to remember is that they are being supervised by bodies that are lacking the characteristics necessary to govern them in the proper manner. Harvard Business School maintains that both of these factors pose inherent risks to the international economy and need to be remedied as soon as possible.

Essentially, the people that are responsible for transferring balance sheet risk are not the ones most qualified for the job. Because of limited experience, the regulatory bodies overseeing many insurance companies and pension funds simply do not have the knowledge to adequately supervise these numerous risk factors. The issue of unnecessary political interference has also helped to cause some of the trouble described above.

As many industry insiders will tell you, if left unchecked, these factors will only erupt into much larger problems and will plague the international financial system for years to come.

Source: www.RiskCenter.com

Recommended specifications of a new trading computer for today

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Trading Computers Are Experiencing Another Major Change!

By Larry Jacobs, Editor of Traders World magazine, September 2007

Yes, there is now another major change going on in the trading computers arena. Both AMD and Intel are changing to their new dual and quad core CPUs. The new CPUs run cooler and are faster. RAM memory is changing from DDR2 to DDR3 faster memory. Video cards are also changing to faster ones with DDR3 memory and better cooling heatsinks. They also support larger and higher-resolution monitors -- up to 30 inches.

Computer cases are improving to handle the new, improved parts. They have more cooling fans and are now rerouting the cabling to allow for better airflow.

And, finally, the power supplies are now larger -- up to 650 to 1,000 watts to support these new computer specifications.

Five years ago, the average trader had a computer with two to four 15- or 17-inch monitors. Now, today’s trader has four to eight 19-, 20- or 30-inch monitors. These also have multiple monitor stands. This major change is because many successful traders are now doing trading for a living, and they understand they need the best equipment.

Traders’ computers are not just simple Dell or HP units off the shelf. They are custom-built units designed specifically for trading. They are optimized and overclocked for maximum speed. Trading computers also have continuous defragging software. This keeps them running at 100 percent efficiency during and after trading hours.

Here are the recommended specifications of a new trading computer for today:

Intel e6700 CPU or higher dual or quad cores
At least 2GB of 800MHz DDR2 or DDR3 RAM
SATA Hard Disk Drives of 7,200 or 10,000 RPM
Antec Silent P182 quiet case
Motherboards with 3 - 4 PCIE video slots
Video cards with at least 256MB of RAM and support screens of at least 24 inches; support for 4 - 10 monitors
20X DVD / CDRW optical drives
PCAngel or Acronis backup system
Finally, it is recommended that trading computers need to be updated to, generally, the best technology every two years. It could be very expensive for a trader to use slow, outdated equipment in this fast-moving trading environment.

For more information, go to www.tradersworld.com