Skill Building and Performance

In competition, how often do we find ourselves in situations where in a moment of pressure we 'know' what to do but we don't 'act' or our response is delayed, in effect altering our outcome? This connection between 'knowing' and 'acting' can be made second nature through situational preparation. Performance under pressure is a 'motor cortex' activity linking cognitive processing and behavioral response. Great athletes, performers, traders, surgeons and the like must train themselves through repetition - practicing by building the connection between receiving and processing input and taking action (making the decision to act). Neurologically, through practice and immersion of our respective activity we help facilitate myelination; the formation of a white sheath that lines and enhances the speed of neuronal firing, which improves the connection between cognitive input and behavioral output. The most effective way to improve this process is by designing exercises and scenario's that mimic real conditions and by immersing yourself in the practice.




Here are some simple steps to get you practicing more efficiently:

1. Organize your input in a hierarchical way

A Doctor for example would have to know how to organize patient findings in a hierarchical way so as to make sense of the input, process it and arrive at a diagnosis. This would involve a multifactorial process of learning how to ask the right questions, begin to assign priority to the various signs and symptoms that are revealed, organize them mentally, then refine and ensure the order of importance through further examination to develop a 'forward looking' diagnosis. The inexperienced clinician or student, may arrive at a diagnosis prematurely, because of a lack of developing a protocol of assigning a value to the signs and symptoms and instead leaping to a premature conclusion.

A trader may have a variety of inputs that signal a trade. Under stressful market conditions, however,   it may be challenging to recall the inputs that are required to assess signal strength or validity. But, by organizing decision-making criteria in a hierarchy and developing the habit of approaching each trading set-up by reviewing the sequence of criteria, you will begin to realize signal differentiation based on quality. Some trade set-ups, based on your logic, will appear more favorable than others in this way. You are effectively installing a 'new program' or creating a new habit by systematically approaching your decisions under pressure.

2.Practice one skill at a time and actively run variations of that skill

If I need to process say 7 different inputs to arrive a decision to make a trade then I practice input 1 in isolation and then incorporate variation on input 1 before progressing to input 2. Lets say input 1 is the nature of the market 'open'; I would practice reviewing only the open and my responsive decision about the day based on the open. I would do this on years of static historical data or on a real simulator. Now, say I categorize the 'open' into four different systems that support my decision making; I would rehearse opening system 1 and make a decision. Then I would rehearse opening system 2 and make a decision. This would be a way of incorporating variation into my practice of a single input, the open. Over time this is how I master decision making and 'the open'.

3.Immerse through repetition

Practice all the inputs simultaneously. If I'm a tennis player and working to improve my back-hand down the line passing shot, I've gone through step 1, of knowing how to efficiently 'style' my backhand for improved economics of swing, grip and foot position. I've practiced step 2, which might be hitting backhands from the baseline to different areas of the court. And then incorporating variation of my back hand by hitting some on the run, which would have me practice my foot speed and position while in motion and practice placing the ball into specific areas of the court.  Step 3 is immersion of all of the above by doing it over and over.

4.Real time simulation

You only develop mastery by creating practice conditions that simulate the challenges of a real experience. A dental student would practice drilling hundreds of teeth on simulators in practice and then under exam type conditions so as to master the practice conditions. Following this rigorous process, the dental student would progress into the clinical environment to work on patients.

A trader would be adequately prepared for the real time pace of the market rotations in his timeframe by simulating experiences through paper trading his ideas in the markets. Practicing steps 1-4 in simulation to develop a congruency in decision making.

5.Learning from outcomes

Journaling and noting success and failures through experience is an effective way to cultivate your expertise and establish consistent and positive outcomes.