Trading Psychology 2.0. Review on Steenbarger's book

Trading Psychology 2.0. Review on Steenbarger's book

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Trading Psychology 2.0 is a book containing lots of proven techniques and critical recommendations to help interested traders better understand the markets and themselves. It was written by the veteran trading psychologist – Brett Steenbarger. No matter where you’re in your trading career you may glean wisdom from it. If you are a newcomer, the author describes the peaks and valleys that might lie in wait for you on your thorny trading path. If you’re an intermediate trader who just blew out the account desperately trying to recover previous losses, you will learn how to get back on the profitable path and not to get into losing streak again. If you’re just doing well, Steenbarger’s book will caution you that this might pass unless you manage to adjust to the changing trading environment.

Trading psychology 2.0 is grounded in the ABCD themes, the key components that might set your mind on success. In four chapters Steenbarger tackles adapting to change, building on strengths, cultivation of creativity, and developing and integrating best practices. Steenbarger’s trading psychology differs markedly from “old school” ones. The old trading psychology put a special emphasis on the elaboration of the trading plan. The new trading psychology highlights the changing nature of markets and necessitates the development of fresh plans for arising contingencies. Old school traders lay a special stress on controlling emotions. Trading Psychology 2.0 advocates cultivation of the positive emotional experience through the exercise of signature talents and skills. The ideal trader, according to the old-school traders, is the one who is dedicated to his trading strategy and is a disciplined rule follower. For the representatives of the 2.0 school of psychologists, the ideal trader is a creative entrepreneur, easily and readily adjusting his trading strategy to new circumstances. The main goal of 2.0 trade is to discover his talents, skills, interests, master his trading techniques and properly exploit them in ever-shifting market dynamics. The old-school trader would concentrate on the creation of the profitable strategy and closely follow its guidelines.

The material of the book is presented in an accessible, understandable, engaging way that makes it relevant for practical traders. The book is full of examples, illustrations, and case studies. These interactive features keep you engaged and involved throughout the reading. Steenbarger is a great writer whose books are worth reading. To me, the only flaw of his writing was the length of the text. By mischance, it is a problem of all great books. But I would recommend to read it anyways, at least some of its fragments that grab your attention the most.

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