How did you learn to think in probabilities?

[arbitrage16]

Did it happen to you over time, naturally? Or was there a particular lesson or resource that helped this perspective click for you.

I have been too focussed on trying to control outcome, with not enough emphasis in my trading on the nature of probabilities, and this has been causing some stress. Think I've identified the issue so would welcome any thoughts, cheers.

[LinusP]

The book ‘Thinking fast and slow’ certainly changed my way of thinking when it comes to probabilities.

[decomez6]

life is a NULL hypothesis.
there is always a chance we all are a figment of imagiantion , living in a dream of a god. what happenns if the god wakes up , do we disappear into oblivion.
what are the chances of my made up story is true ?
is it plausible?
do i have any evidence?
if no evidence is available to back up my claim , you can reject it without eveidence and thats probably what you`ve just done.

[gazuty]

Baby I was born this way.

I’m editing this because the simplest way to explain it is every time the teacher at school or at university wrote a problem up on the board and then demonstrated the solution my brain said “of course” or already knew how to solve the problem.

And then I practiced. Not just one or two problems. I practiced heaps of problems night after night after night. I had a friend and we would ring each other at 10 pm each night and go over our solutions to maths problems we had done that evening.

[arbitrage16]

if no evidence is available to back up my claim , you can reject it without eveidence and thats probably what you`ve just done.

Always good to see Hitchens being quoted, even if a little sloppily

[arbitrage16]

The book ‘Thinking fast and slow’ certainly changed my way of thinking when it comes to probabilities.

Interesting, how so? I have read it and love Kahneman, reading Noise at the moment, but I don't remember anything specific about probabilities. Probably need to go and have another look!

[Euler]

I learnt to code when I was young, but that led me into probability as I started modelling footy matches as one of my first non game related projects. Nothings been black and white since.

[ShaunWhite]

Just life experience, things you think are a dead cert go tits up and things you didn't imagine happening, happen. Everything from your health to being shat on by a seagull falls somewhere between 0% and 100%. You can't even be 0% or 100% sure about an Amazon delivery so something wooly like a price move is way off the scale of surety.

I've also never been a believer in the concept of 'luck', imo that's just a load of bollox from people trying to see you rabbits' feet, so if you don't recognise 'luck' then you're left with probability.

[ShaunWhite]

...and I'm a pessimist by nature. My default is 'this is probably wrong' rather than this is definately right.

[Euler]

Luck is where opportunity meets ability.

[alexmr2]

Trading In The Zone (or Mark Douglas's video lecture), some parts of Thinking Fast and Slow and probably some other Youtube videos explain it well but at the end of the day it's up to us to put it into practice.

Personally even though I understood the concept 2-3 years ago, I still struggle to rewire my brain into thinking this way because I usually revert to trying to be always right at some point. Other days I can do it, it's boring but the results speak for themselves despite all the times I got it wrong

[ShaunWhite]

Seriously, if anyone thinks that complex questions only have binary answers, and that answer is their's, then they aren't going to be a trader.

Alex ...."Personally even though I understood the concept 2-3 years ago, I still struggle to rewire my brain into thinking this way ".
You're joking right? You struggle to understand the concept that there's situations when you're not right ?!?

What happened to humility? Might explain why 'member since sept 2018' is still struggling?

[alexmr2]

Seriously, if anyone thinks that complex questions only have binary answers, and that answer is their's, then they aren't going to be a trader.

Alex ...."Personally even though I understood the concept 2-3 years ago, I still struggle to rewire my brain into thinking this way ".
You're joking right? You struggle to understand the concept that there's situations when you're not right ?!?

What happened to humility? Might explain why 'member since sept 2018' is still struggling?

The concept of thinking in probabilities is relatively simple, but successfully putting it into practice with real money, consistently over hundreds of markets without occassionally reverting back to moments of irrational trading is very difficult.

It's counter intuitive and in my opinion the nature of fast moving pre-off markets where there isn't much time to think is probably even harder than the markets those books are geared towards. At least they have more time to think than someone who just lost focus for a split second, and got an insta-5tick spike against their entry at Ffos Las. I'd also say in terms of pre-off there is a wide range of market behaviours and a lot of other experience needed to be consistently successful, not just the ability to think in probabilities

[ShaunWhite]

there isn't much time to think

That's just inexperience, queue the old analogy about learning to drive. Remember how it was so overwhelming at first and now you can do it without even remebering you have?

My take away from TiTZ, Thinking Fat and Slow etc is that they basically say 'be mindful until a process can be done sufficiently well for it to be handed over from system 1 to system 2'. Some people write 'concentrate until you don't need to' on a post-it note, some write that over and over again on 150 pages and it's a best seller.

Markets never do anything that couldn't have been anticpated, figure out what you'll do in each situation beforehand rather in the heat of battle with cash on the table. Those various situations are more or less likely given the type of market. There isn't much time to think as you say so do all your thinking another time and then all you're doing is responding to situations with a pre-planned action.

[ShaunWhite]

someone who just lost focus for a split second, and got an insta-5tick spike against their entry at Ffos Las.

"lost focus?"

#1 You sometimes need to concentrate for as long as one whole minute.
#2 Don't become a brain surgeon. Sorry Mrs X, I lost focus for a split second now your legs don't work.