We have been reading Dr. Brett Steenbarger's recent book, Enhancing Trader Performance, now featured on our recommended list. (Some time spent in air travel is always good for serious reading.) Our audience will find this book quite helpful. In general, we feature work as we specifically cite it in our own analysis. There are so many applications in this book, that we will be pointing to it repeatedly.
For now, let us consider a very general review, showing who will find the book helpful and why.
The greatest strength of this work is the authoritative combination of theory and practice. Dr. Brett draws upon a body of theoretical literature showing a logical progression from building competence, moving from competence to expertise, and using that expertise to become successful. It is the whole package presented by a great writer who understands the theory.
Unlike many works in which the strictly academic approach renders them inaccessible to most readers, this book is fun. Each theoretical step is salted with examples from those who have achieved great success by implementing the principles. The reader learns about how noted athletic performers like Dan Gable, Wayne Gretzky, Muhammad Ali, and Lance Armstrong employed the specific methods described. This does not mean, of course, that these athletes had all read the relevant literature. Instead, they learned or developed key methods on their own. Nonetheless, their success demonstrates the power of the theories.
For traders, another great strength of the book is the application of theory to practice. Because of his personal work in observing and helping traders with their problems and methods, Brett's writing really comes to life. Anyone has done some trading will recognize the characters in themselves or someone they know. Any trader has experienced many of the same foibles as the featured characters, who are all real traders. The reality of the examples gives the lessons and advice the ring of authenticity.
While the book is aimed at a trading audience, it is quite useful for anyone engaged in competitive activity where performance is measured. This is not just about trading. Those competing in athletics or games of the mind will find the work most helpful. Our own experience involves competing and coaching people in competitive activities like bridge, backgammon, chess, sports handicapping, poker and debate. Nearly every chapter has lessons for those striving for success in these fields.
An Important Lesson
There are also important lessons for the individual investor. So much of today's marketing makes it seem easy for anyone to beat the market. Enhancing Trader Performance shows that learning the key lessons to become successful is hard work. It requires a level of commitment that many would not have. It is better to know this before starting, than to learn the hard way.
Briefly put, this is a must-read for traders and for system developers. It is also recommended for those engaged in any competitive activity. Finally, it is useful for individual investors. Taking the time to understand the problems faced by top traders is the first step. Those unwilling to make the time commitment to read and learn are unlikely to achieve long-run success. Read this book first!