{"id":23328,"date":"2013-01-21T08:19:32","date_gmt":"2013-01-21T13:19:32","guid":{"rendered":"http:\/\/www.smbtraining.com\/blog\/?p=23328"},"modified":"2013-01-21T08:19:32","modified_gmt":"2013-01-21T13:19:32","slug":"cnbc-made-me-do-it","status":"publish","type":"post","link":"https:\/\/www.smbtraining.com\/blog\/cnbc-made-me-do-it","title":{"rendered":"CNBC Made Me Do It!"},"content":{"rendered":"

Here is an interesting comment from a reader in response to my blog post “My Thought Process: LIFE”<\/a><\/p>\n

Steve,<\/strong><\/strong><\/p>\n

Thank you sir \u00a0for your thoughts. I constantly look for your tweets during the day. I don’t know why I bought so many books in the past. I have learned a lot from your generosity.
\nI turned LIFE green into red due to recency bias and confirmation bias. Good thing did not do revenge trade. \u00a0Yesterday, I scaled out of ASML sooner than I should have. So, I determined to stay with LIFE longer (recency bias). Another mistake, \u00a0listened to CNBC anchor (while in the trade) saying that hedge funds won’t even sell out at $65 or so on take over. Bingo, I got confirmation bias and so decided to stay longer. Thus, turned it into chop shop. I saw your tweets live that you’re done with the trade. Well, I ignored your view \u00a0due to my bias. \u00a0Well, next time, I need to stop and think fresh.<\/p>\n

Thanks again for your time.<\/p>\n

GM<\/p>\n

Some interesting thoughts there. Here is my feedback<\/p>\n

 <\/p>\n

    \n
  1. \u201cI don\u2019t know why I bought so many books in the past.\u201d<\/strong>\n
      \n
    1. Up until the time we started SMB I had only read one trading book regarding setups back in 1998. I have read several books about successful traders such as \u201cmarket wizards\u201d. I believe you can get a lot more from books that address the issue of process which is a common thread in all performance related fields.<\/li>\n
    2. Prior to starting our foundation training program we give a reading list to our trainees that have zero to do with the technical aspects of the market. We cover our thoughts on technicals\/strategies in the course and it is far more important to learn the importance of psychology and practice in your development.<\/li>\n<\/ol>\n<\/li>\n
    3. \u201cI turned LIFE green into red due to recency bias and confirmation bias.\u201d<\/strong>\n
        \n
      1. This is actually not as bad as you think. 99% of the population goes through life suffering from these biases and aren\u2019t even aware they have them. Being aware of a bad habit is the first step towards correcting it.<\/li>\n
      2. Generally a winning trade should never become a losing trade. Sometimes the trade can become a scratch but not a losing trade. I don\u2019t mean by this trades you were up 10 cents and then reversed and you got stopped out. I mean a trade that hit your first profit target…<\/li>\n<\/ol>\n<\/li>\n
      3. Yesterday, I scaled out of ASML sooner than I should have. So, I determined to stay with LIFE longer (recency bias).<\/strong>\n
          \n
        1. Do you have a formal playbook? What are you basing the fact that you got out sooner than you \u201cshould have\u201d. Hindsight is 20\/20. What was your trading plan? (i hope you had one).<\/li>\n
        2. These were not remotely similar setups. Trade similar setups similarly. Different setups should be traded differently.<\/li>\n<\/ol>\n<\/li>\n
        3. Another mistake, \u00a0listened to CNBC anchor (while in the trade) saying that hedge funds won’t even sell out at $65 or so on take over. Bingo, I got confirmation bias and so decided to stay longer.<\/strong>\n
            \n
          1. If you were a trader on my desk i would be fuming right now. \u201cCNBC anchor\u201d yikes! I fought for CNBC on my trading floor in 1996 as there was an edge in having access to that information. There is no longer an edge. It is a distraction. Turn it off.<\/li>\n<\/ol>\n<\/li>\n
          2. I saw your tweets live that you’re done with the trade. Well, I ignored your view \u00a0due to my bias. \u00a0Well, next time, I need to stop and think fresh.<\/strong>\n
              \n
                \n
                  \n
                1. I shared relevant factual trading information. You should consider it and then make a trading decision based on a host of other factors. Hopefully some person on CNBC talking about a takeover price that is acceptable to hedge funds that are long won\u2019t be given too much weight on an intra-day trade.<\/li>\n<\/ol>\n<\/ol>\n<\/ol>\n

                  \"\"<\/a><\/p>\n

                  Steven Spencer is the co-founder of SMB Capital and SMB University and has traded professionally for 16 years. His email is sspencer@smbcap.com.<\/p>\n

                  No relevant positions<\/p>\n

                   <\/p>\n

                   <\/li>\n<\/ol>\n","protected":false},"excerpt":{"rendered":"

                  Here is an interesting comment from a reader in response to my blog post “My Thought Process: LIFE” Steve, Thank you sir \u00a0for your thoughts. I constantly look for your tweets during the day. I don’t know why I bought so many books in the past. I have learned a lot from your generosity. I turned LIFE green into red … Read More<\/a><\/p>\n","protected":false},"author":143,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1,8,1373],"tags":[2461,2462,4703,4706,4707,653,2463,1989,4690],"class_list":["post-23328","post","type-post","status-publish","format-standard","hentry","category-general-comments-2","category-steven_spencer_steves_blogs","category-trading-lesson","tag-day-traders","tag-day-trading-how-to","tag-learn-trading","tag-stock-trading-education","tag-stock-training","tag-trader-training","tag-traders-training","tag-trading-course","tag-trading-education","no-post-thumbnail"],"yoast_head":"\nCNBC Made Me Do It! | SMB Training<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.smbtraining.com\/blog\/cnbc-made-me-do-it\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"CNBC Made Me Do It! | SMB Training\" \/>\n<meta property=\"og:description\" content=\"Here is an interesting comment from a reader in response to my blog post “My Thought Process: LIFE” Steve, Thank you sir \u00a0for your thoughts. 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