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Pay attention to what the market is doing right now.
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Tharp's Thoughts
Inbox Mentoring
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Feature: Trade Through "Mindfulness", by Van K. Tharp, Ph.D.
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Workshops: Forex Is Back! August and October Events
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Tips: A Dangerous Bias in Current Markets, by D.R. Barton, Jr.
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GDPR: Read Our GDPR Statement
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The mission of the Super Trader program is to
not only transform your trading but also your life.
Future Super Traders: Consider This
Peak Performance 101 in July is a very important workshop to put on your calendar if you want to qualify for and apply to the Super Trader program. Why? The price for the program goes up on August 1, 2018.
- Currently, the cost is $22,500 per year and you pay for three years up front in two installments.
- After August 1st, the cost will be $25,000 per year and you’ll pay for three years up front in two installments.
July is your last month to get the current pricing of $22,500 per year. In addition, we are running two specials in July only:
- We will offer the same rate that was available in June 2017 of $20,000 per year if you make one payment of $60,000.
- We will also give you the option to make three payments: $23,000 payable up front and in two more payments of $23,000 in semi-annual installments.
One Payment Offer Details — If you apply to become a Super Trader before August 1, Dr. Tharp has a special price offer for you! The payment for the program is generally set up for 2 payments 6 months apart, but by paying upfront you can save $7,500 off the total current cost of $67,500 for 3 years when you qualify for the program! If you are accepted in July, you get this discounted rate by making one lump sum payment. This offer is only good through July 31st.
Your first step is registering for the Peak Performance 101, July 13 - 15.
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Learn more about the Super Trader experience in the video below.
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Trade Through "Mindfulness"
by Van K. Tharp, Ph.D.
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What would happen if you could just pay attention to what the market is doing right now? You'd be totally in the present with no preconceived ideas or biases to influence you. If you did that, your trading probably would accelerate to a new level. You can trade that way if you practice "mindfulness."
For example, in October 2008 a friend of mine had lost a lot of money in the markets. I told him to get out. I said that we were in a major bear market and he should just get out until it ended. He followed my advice.
The next week the Federal Reserve lowered the discount rate. The market moved up on the news, and he called me, wanting to get back in the market. I said that when the market starts going up again, it will be obvious.
Short-term reactions to news tend to be large in bear markets; however, if you just watch what is going on, it is obvious. Most people have trouble with this. They can't watch what is going on because their heads are so full of chatter. The solution is to trade through mindfulness.
Mindfulness first came to my attention as a form of meditation in which you simply quiet your mind and then "watch your thoughts" as they come up. When a thought pops into your mind, you notice that it is there and then release it. That's all there is to the meditation, but it can have a profound impact on your life if you do it regularly.
Mindfulness is also a state of being. The Harvard psychologist Ellen Langer has popularized the term through two books: Mindfulness and The Power of Mindful Learning. She defines mindfulness as a state of being in which one is likely to be (1) creating new categories, (2) welcoming new information, (3) looking at things from multiple perspectives, (4) controlling the context, and (5) putting the process before the outcome.
1. Creating New Categories
Mindfulness is the opposite of mindlessness. Mindlessness means living by your conditioning. It means assuming that all your beliefs are fixed and true so that all you can do is find evidence to support that truth. Mindfulness, in contrast, is the continual creation of new concepts and categories with no real attachment to their truth.
For example, think about your last day of trading. What was it like? You might say, "I put on some long trades and some short ones. I also closed out some trades — some at a profit and some at a loss. In between, I watched the market."
Even if I offered you money for everything you could list that you did yesterday with respect to trading, you still probably couldn't come up with much more than what I just listed. Yet you did so much more. You probably experienced a thousand different emotions, which you've forgotten. You probably read 100 news items. You probably talked on the phone to some people. But unless I mention those things to you, you probably wouldn't think of them.
Most strong opinions rest on global categorization:
- The market went up yesterday.
- We are in a C wave of an ABC correction.
- I lost money yesterday, but I followed my system.
- We are in an up move in a secular bear market.
- I should pay attention to what is going on now in the market.
All those statements reflect global categories that you probably use to form your opinions. What would happen if you formed new categories of thought about the market? Think about the market in great detail. Who are the different players? What do you think each of them is doing with respect to the market? Call people you know, and notice their reactions and their perspectives. Break old thinking patterns by creating new categories, and you'll step up your trading.
2. Welcoming New Information
New information continually impinges on all living creatures, and their ability to survive depends on their openness to that information. Research has shown that people undergo temporary psychological damage if they are deprived of new information for any length of time. If they are deprived of sensory input, young animals become severely impaired later in life. You need sensory information to stimulate you.
Most people are exposed to new information continually, and so the lack of it is not a problem. However, most of us tend to filter, generalize, distort, or delete most of that information. Becoming more receptive to the information that is coming in to you is a major step toward improving your performance as a trader.
3. Looking at Things from Multiple Perspectives
There are at least three general positions or perspectives from which information can be viewed. The first perspective, position 1, is the "I" position: "How does this information affect me?"
The second perspective, position 2, is how it affects another person directly: "What is that person's perspective?" The second position might be that of the person who takes the opposite side of your trade or perhaps the person who is making the market for you. Looking at new information from that person's perspective may be a valuable thing to do.
The third perspective, position 3, is that of the neutral observer who is watching all the other participants. This is like someone out in space who can see what everyone else is doing and then view it all from a global perspective.
These three perspectives were crucial in Einstein's thinking processes. This was part of how he formed his great ideas about relativity. Those perspectives are also the basis for some of the most powerful change work I know about. Try them on. Of course, there are many possible players for positions 1 and 2. You can try on numerous possibilities and gain tremendous insights as a result. You'll gain choice in terms of how to respond, empathy for other people, and the ability to change your behavior much more easily. One of our instructors actually developed a trading system by determining his strongest beliefs, then taking the exact opposite viewpoint. It turned out to be
one of his best systems.
Remember that most people have "good" reasons for behavior that you might consider negative. The intentions behind those behaviors are good. If you close out a trade early, are you "nervous" or are you "cautious"? If you fail to take a trade, is it because you are "afraid" or because you haven't totally developed and tested your plan for trading? Typically, the behaviors you most want to change are the mirror images of the qualities you value most. Thus, if you are having trouble "pulling the trigger," you probably value a thoroughly tested plan and don't have one.
4. Controlling the Context
Much of your behavior is context dependent. For example, many professional traders know it is possible to lose $20,000 in a trade, perhaps paying $1,500 in trade costs in the process. However, the same traders are much less likely to pay $1,500 to attend a course that could reshape their trading and help them avoid many of those losses. The thinking behind such logic is that the loss is a cost of doing business whereas the course is an unnecessary expense. Notice what happens to the logic if the trader switches it around and starts to think of instructional learning as being essential to doing business well. It becomes much more significant than the losing trades,
especially since it may save the trader many thousands of dollars in a single year. Of course, that depends on the course the trader selects.
People who practice mindfulness are aware of the context in which they are interpreting events. They are also willing to shift contexts to determine the impact on their behavior and their thinking. As a result, they give themselves much more choice and are much more likely to make money.
Ask yourself the following questions:
- How am I interpreting my losses?
- What is the context in which I am viewing all my trading?
- How does trading fit into the scheme of things in my life?
- What if I shifted the context on just one of these questions?
5. Putting the Process before the Outcome
People can imagine themselves taking gradual steps, but great heights seem totally forbidding. Yet when you take enough gradual steps, you'll reach great heights.
If you are concerned with the final result-the outcome-you probably will have problems attaining the outcome. However, if you concentrate on the process of getting to the outcome, you are much more likely to arrive at your destination.
Every outcome is preceded by a process. You will not make money trading unless you follow a predetermined plan and stick to that plan. That's why you should pat yourself on the back every day if you can honestly say that you totally followed your rules throughout the day. Every Super Trader arrives at that stature by taking one trade at a time. The primary difference between that person and the average trader is that the Super Trader probably continued to follow his or her plan every single day. The Super Trader probably made very few mistakes.
What can you do to practice mindfulness in your trading?
- Do a 20-minute mindfulness meditation each day for at least a week. If you practice watching your thoughts (and releasing them as soon as you notice them), you can be satisfied that you are doing the exercise appropriately.
- Keep a regular diary of what is going on in your life. Do it for a few days before you start the mindfulness meditation and then keep it up. When you've completed a week of mindfulness meditation, look at your diary and notice how your life is different.
- Bring mindfulness into your trading and investing by doing the following:
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- Imagine yourself taking the other side of every trade that you actually take. What does that position feel like? Also imagine yourself being a neutral observer who watches as you and the other person both take a position in the market. What do you think that person would think?
- Look for new information about each new trade. What information are you normally accepting and what information are you normally rejecting?
- When you do something you don't like in your trading, notice the context in which you are interpreting not liking it. How else might you interpret that behavior? What other intention might cause that behavior? Perhaps those other intentions are something you value highly.
- Concentrate on the process of trading-following your rules. In fact, at the end of each day, ask yourself a simple question: "Did I follow my rules?" If you did, pat yourself on the back. If you don't have any rules, you obviously didn't follow them. Think about it.
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These exercises are powerful if you do them. If you don't do them, they are meaningless. Are you going to do them? If the answer is no, ask yourself why not. It is probably because you don't believe they will help you. If that's the case, put that belief through the Belief Examination Paradigm I showed you earlier. Perhaps you are not committed to trading success. If that's the case, what are you committed to? What do you love to do?
This article is an excerpt from the book "Super Trader: Make Consistent Profits in Good and Bad Markets", McGraw Hill", copyright 2011."
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About the Author: Trading coach, and author, Dr. Van K. Tharp is widely recognized for his best-selling books and his outstanding Peak Performance Home Study program - a highly regarded classic that is suitable for all levels of traders and investors. You can learn more about Van Tharp www.vantharp.com.
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Instructor RJ Hixson walks you through some of the benefits
of our Peak Performance 101 workshop in the video below.
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A Dangerous Bias in Current Markets
by D.R. Barton, Jr.
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At my alma mater, Radford High, Mae Jennings was a legend.
She never married — instead she devoted her life to teaching biology and farming. She lived her whole life in the farmhouse where she was born and raised. Miss Jennings was known as a strict grader and she accepted no frivolity in class and especially none in the lab.
I entered her class with a combination of terror and excitement because at the time, I already loved biology and I wanted to be at a zoologist. My year with Miss Jennings was to be the last that she taught. (The rumors that my nit-picking drove her to retire were greatly exaggerated … but not without some slight basis in fact.)
The very first day of class, Miss Jennings peppered us with questions to test our knowledge of the subject. I was ready with answers to every one of her questions.
Requirements for photosynthesis? What is this, fourth grade?
Diffusion vs. osmosis? Please!
Mitosis vs. meiosis? Piece of cake.
Then she moved to the animal portion of our Q&A session. I knew every answer and generously shared my knowledge. I was on fire. In another few questions, however, I was actually asked to stop raising my hand.
Miss Jennings continued asking questions but then she did the unthinkable . . . After querying the class about the oldest living animals, she “corrected” everyone with the answer of the blue whale.
Miss Jennings had given a wrong answer!
Knowing the correct answer, I could not contain myself. I politely disagreed with her citing a National Geographic magazine at my house which stated that the Galápagos tortoise was the longest-lived animal.
Miss Jennings informed the class that animal longevity was proportional to heart size, hence the largest animal (the blue whale) is the longest-lived. She then informed me that no rebuttal would be allowed and that, in fact, I could come back to her classroom after school for some educational detention. Now during my school years, I had done my fair share of time in detention for talking during class but I must say this was the first time I had earned it on the opening day of school!
When I returned for detention that day after school, what happened was so bizarre that I couldn’t possibly make it up. I walked into Miss Jennings’ classroom and without a word, she marched me over to a bookshelf where she pulled out (and dusted off) a green-covered biology textbook. She dug through the index and turned to the section that had animal species longevity as a function of heart size. Elephants — the largest land animals, lived to be 250 years old. Also according to this book, blue whales lived for — 1,000 years!
I asked to see the book and checked the copyright date — 1933. It was her college textbook. Since then, a lot of new information from the zoological world had come out but … she stuck with what she “knew.”
That experience taught me an extremely valuable lesson about decision making. The beliefs Miss Jennings formed in a university course proved to be a powerful anchor point on the subject of animal longevity. She discounted any new information that contrasted her memory and challenged her decision-making capabilities.
Knowing about this kind of human behavior is exceptionally useful in the markets right now.
It is this “anchoring bias” that has so many people missing out on profits in today’s market environment. This mindset issue is worth learning about. Here’s a definition of this bias from the world of psychology:
Anchoring bias occurs when we make a decision or evaluation based on the first piece of information received. Our first impression acts as an anchor or reference point to which all subsequent and related information is compared. If the anchor contains incomplete or irrelevant information we can end up making a bad decision.
As I found out in detention that afternoon long ago, Miss Jennings was anchored securely to her original learning on animal longevity.
Many “smart” traders and investors, however, follow similar anchor patterns.
Most famously, we consider the price where we bought a stock to be a key characteristic of that company as long as we’re in the trade. If it drops, there’s a part of our mind that considers our original purchase price as the “fair value.”
Right now, we have an even more insidious form of anchoring bias gripping many traders and investors. Leading up to January of 2018, the U.S. equities market had been almost a one-way ride for the better part of two years:
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Then came the implosion of the inverse-volatility trade in late January, and the market reintroduced two-way action to everyone:
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The return of volatility has paralyzed some traders who remain mentally anchored to a market that only went one way for so long. As long as we get supporting internal confirmation like strong breadth and supportive earnings fundamentals, pullbacks are still to be bought — just a bit more patiently.
Recognizing that we have anchoring bias built into our DNA is the first step to helping us overcome this block for sound money-making decisions. Instead, let's make trading decisions based on our trading plans and systems while adapting to different kinds of market conditions.
Great trading and God bless you.
D. R.
P.S. My story with Miss Jennings ended well. Even though my first detention session finished with her calling me a know-it-all, Miss Jennings completed the final year of her teaching career by nominating me for a state-wide biology scholarship. She found out that I really did share a deep love for her favorite subject. And that old green book? Miss Jennings gave it to me for a keepsake as she packed up for retirement …
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About the Author: A passion for the systematic approach to the markets and lifelong love of teaching and learning have propelled D.R. Barton, Jr. to the top of the investment and trading arena. He is a regularly featured analyst on Fox Business Networks’ Varney & Co. TV show (catch him Tuesdays at 9:30 a.m. EST), on Bloomberg Radio Taking Stock and MarketWatch's Money Life Show. He is also a regular guest analyst on CNBC World, CNBC's Closing Bell, Fox Business Network’s Cavuto Coast to Coast and Making Money with Charles Payne and the China Global Television Network. His articles have appeared on SmartMoney.com, MarketWatch.com and Financial Advisor magazine. You may contact D.R. at "drbarton" at
"vantharp.com."
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Two Dates - Two Continents
Peak Performance 101 Will Change How You THINK about Trading
♦ JULY 13-15, CARY, NC
♦ OCTOBER 12-14, LONDON, ENGLAND
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Workshop Objectives
Students will learn and begin to understand each of these objectives after attending Peak Performance 101:
- How great traders approach their craft and learn a daily procedure that resembles what they do.
- How you create your own experience in the market and how you are responsible for the results that you get.
- Become more aware of some of your own psychological issues that affect your performance as a trader/investor.
- Learn about expectancy, position sizing strategies and the power of big R-multiples through a simulation game. This game is also designed to help you observe your emotions in a setting in which only a small amount is at stake compared with what you will face in the market.
- Learn some of the variables that affect your emotions and how you can gain control over them.
- Learn to overcome self-sabotage through exercises done in the class.
- Students will get guidance on how to develop an ongoing program to work on themselves using the Super Trader Program as a model.
- Students will leave with a plan to make the maximum use of the workshop.
- Participants in this course will get to meet and network with some really great people who have a lot in common with each other.
Attendees were asked to list the top five benefits of attending this workshop. Here are some examples:
- Being part of a group that has similar objectives in life.
- Learning exercises to control emotions.
- Identifying issues that hurt trading.
- Learning the ten tasks of trading and their mental states and strategies.
- Discovering beliefs attendees never knew they had.
- Experiential learning through the exercises and game.
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Cryptoasset Trading & Blockchain Technology
Only available to those enrolled in our Super Trader Program.
Presented by Van Tharp
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June 19-21
Tuesday-Thursday
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The Basic and Advanced Options workshops have now been opened to the public (this workshop is traditionally a Super Trader Only workshop). However, to attend there are certain qualifications you must meet. Please call us at 919-466-0043 so we may speak with you regarding your level of experience trading.
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Options Trading
Presented by Chuck Whitman
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June 23-25
Saturday-Monday
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Options Trading Advanced
Presented by Chuck Whitman
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June 27-28
Wednesday-Thursday
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Presented by Van Tharp,
with RJ Hixson
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July 17-19
Tuesday-Thursday
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Learn the Mental Secrets for Getting What You Really Want!
The material covered in this course will be information you can use to improve your life and your effectiveness.
The material will also be cutting-edge. It's not the sort of thing you can learn anywhere else. This workshop will probably be the only place that you could possibly pick up all of this unique information together.
Most importantly, the material will be presented in a practical way with plenty of exercises so you can incorporate the strategies you learn right into your daily life. When you leave the workshop, the most important strategies will become part of you.
Remember, this is a very exclusive workshop. It requires that you’ve attended Peak 101. We will be doing a lot of work with sub-modalities so you should at least have a little experience working with submodalities.
In addition, you can expect highly motivated, like-minded, success-oriented traders like you to join you in this incredible experiential workshop.
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Presented by Gabriel Grammatidis
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August 11-13
Saturday-Monday
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Presented by Gabriel Grammatidis
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August 14-15
Tuesday-Wednesday
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Presented by Kim Andersson
Profit When Price Goes Nowhere: How to Successfully Trade Sideways Markets In Every Time Frame
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August 17-19
Friday-Sunday
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The Forex Trading Systems Workshop teaches three robust Forex Systems. All three systems are based on the concept of trend-following. Each system is based on similar “ingredients,” but each has a different recipe to capture a different part of the trend. Consequently, the systems
are complementary to each other and together offer several trading setups nearly every day of the year. Two locations to choose from, Cary NC in August and London, England in October.
No matter what time frame you trade or what method you use to measure them, Sideways markets happen between 59% and 65% of the time! And even though they appear a majority of the time, Sideways markets are rarely discussed, even in professional trading circles. Until now....
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Presented by R. J. Hixson
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September 14-16
Friday-Sunday
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Presented by Libby Adams and RJ HIxson
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September 18-21
Tuesday-Friday
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The How to Develop Winning Systems Workshop teaches you what you need to know to develop your own system. The material you will learn is not market or time-frame specific. So whether you trade stocks, futures, currencies, gold, etc., or
whether you place 50 trades per day or 50 trades per year, you will learn all of the components that work in any system. With this knowledge you can both modify existing systems to fit you or the market type better, or master your own system development.
Two locations to choose from, Cary, NC in September and London, England in October!
The Peak Performance 202 Workshop is divided into three sections covering 4 days:
- How you are programmed to follow the path that others want you to follow.
- The various games that you play.
- Personal reinvention.
Past participants say this was one of the most significant workshops they had ever attended. You will leave with a new sense of purpose and a new direction and a support team behind them.
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Presented by Van Tharp,
with RJ Hixson
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October 12-14
Friday-Sunday
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October 16-18
Tuesday-Thursday
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Presented by Gabriel Grammatidis
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October 20-22
Saturday-Monday
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Presented by Gabriel Grammatidis
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October 23-24
Tuesday-Wednesday
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October 26-28
Friday-Sunday
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November 9-11
Friday-Sunday
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November 12-13
Monday-Tuesday
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Exciting New Work from Van Tharp
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November
15-17
Thursday-Saturday
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FREE Book!
We pay for the book, you just pay for shipping.
When you add the free book to an item already being shipped there is generally no extra shipping charge (of course, depending on your location).
Read Van’s Latest Book —
TRADING BEYOND THE MATRIX
The Red Pill for Traders and Investors
Eleven traders tell their stories about transforming
their trading results and lives, in this 400 plus page book.
Below is a brief video on how powerful this book is to traders.
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GDPR COMPLIANCE:
The European Union General Data Protection Regulation (GDPR) went into effect on May 25, 2018 and is designed to allow individuals to more effectively control their personal data. At The Van Tharp Institute (IITM, INC) , client information is private and confidential; we do not share, trade, or sell to anyone. We never have. You may ask us at any time to unsubscribe. We keep your information safe. If you’d like access to your information just ask. You receive this information from us because you opted into the Van Tharp newsletter either through direct registration or registration through our Tharp Trader Test.
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Cary, NC Workshop Information
For a list of nearby hotels for our Cary, North Carolina locations,
click here.
Book your flight arriving to the Raleigh-Durham International Airport (RDU).
When traveling to a three-day course, it's best to arrive the evening before.
To help determine your arrival and departure times, see:
Questions? Click Here to Ask Van...
CONTACT US
This is a supplement to our subscription based newsletter, Tharp's Thoughts.
800-385-4486 * 919-466-0043 * Fax 919-466-0408
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