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Two Brains Are Better Than One

InvestorEducation / Learn to Trade Sep 01, 2009 - 02:13 PM GMT

By: Charles_Maley


I dream of painting, and then I paint my dream - Vincent Van Gogh

Even though my father would say on occasion that I didn’t have a brain in my head, I found out later that I actually have two.

The left hemisphere which controls the right side of the body, helps us with the deductive or analytical, non emotional challenges. The left brain would kick in for example when adding numbers or putting together a jigsaw puzzle. It also reasons logically and communicates through language.

The right hemisphere which controls the left side of our body is more inductive, intuitive and emotional. The right brain has feelings if you will, where the left brain does not. The right brain helps us to perform functions like listening to music or writing a poem. The right brain communicates through intuitions, dreams and gut-feelings.

We are inclined to process information using our dominant side. However, in a perfect world it would be best if we processed information by using both hemispheres in a balanced fashion.

Vincent Van Gogh once said, “I dream my painting, then I paint my dream.”

I think this quote has significance in the process of developing a trading system. Since the right brain is creative, it is probably where we should start when developing a trading system. The right brain influences of market intuitions, observations and gut feelings should be explored to dream the painting. Systems that are built exclusively by manipulating numbers until you get a nice painting, rarely work in the real world. As I have stated in previous posts, a system should be grounded in logic that stems from market behavior.

Since the left brain deals better with “reality” it probably makes sense to organize these intuitions and observations into quantifiable data. Now we can run tests to analyze the data through mathematical back testing in order to paint the dream. The left brain is much better at organizing and executing a plan.

So, if you are inclined to throw your computer at data, you may want to work on strengthening the less dominant side or solicit help from a right brained market observer. This should help to develop an approach that makes sense. On the other hand, you could be a keen observer with great intuitions but need help in analyzing what you believe to be true. Perhaps you could team up with a professional number cruncher to help mechanize your plan as much as possible. This should help with disciplined execution and strategic risk management.

In any event, I think it’s important to realize where your dominance lies, so you can work on any disadvantages to strengthen your trading skills. Try to maintain balanced hemispheres and give yourself a wider set of options to make quality decisions.

If you don’t know whether you are right brained or left brained………take this test:

Charles Maley Visit our trader's blog!
Charles has been in the financial arena since 1980. Charles is a Partner of Angus Jackson Partners, Inc. where he is currently building a track record trading the concepts that has taken thirty years to learn. He uses multiple trading systems to trade over 65 markets with multiple risk management strategies. More importantly he manages the programs in the “Real World”, adjusting for the surprises of inevitable change and random events. Charles keeps a Blog on the concepts, observations, and intuitions that can help all traders become better traders.

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David Brooks
02 Sep 09, 12:06
Van Gogh never wrote that

That's an often heard quote, but the truth is Vincent van Gogh never wrote that. I've confirmed this with the Van Gogh Museum in Amsterdam. Nice quote, but apocryphal.

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