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Effects of Automation on Discipline

Posted: Tue Sep 09, 2003 3:20 pm
by Chessman
I just recently couple of months ago fully automated all of my trading. It took me a few weeks to get use to it, but now I feel it is a very liberating experience.

I have noticed the following:

1) Reduction in Stress.

2) Freeing up more time to do research, work on myself and post messages on Traders Roundtable...

3) I find I am much more disciplined with automated trading. My constant life long need to 'beat' my strategies is greatly reduced.

As someone said watching the market during the day is like playing the slot machine, you end up feeding it all day. Automation seems to help break that habit in my case.

I was wondering if others who use automation have had similar results?

PS. when I say I automated all of my trading, I mean that the strategies have been programed in and the computer executes the orders unattended.

Posted: Mon Nov 17, 2003 12:41 am
by Kiwi
I am curious Chessman. Have you continued as you were? How are things feeling now?

Posted: Mon Nov 17, 2003 8:07 am
by Chessman
Kiwi, thanks for following up.

After the initial exuberance about automated trading, I did fall back in my old pattern of trying to override or beat the system. I found myself at times shutting off the automated system, there were other times when I would hedge the positions against the system. For example if auto went long stock indexes (SP), I would hedge in Nasdaq (NQ).

So my trading results improved somewhat but not by much. However all those other things I mentioned are true, reduction in stress, more free time to do other things.

So to sum up, if you don't resolve the underlying issues of sabotage, they tend to show up in a different form. However now with all my work with psychology things are much better, I am able to let the systems run without much intervention.

Posted: Mon Nov 17, 2003 4:23 pm
by Kiwi
Excellent Chessman. I have found the same to be true ... following my system consistently reduces stress and generates faith in myself. It seems to provide some separation between yourself and the price and equity movements.