Two Brains For Extraordinary Gains

The “two brains — right and left” concept refers to the two cerebral hemispheres of the human brain. Popular notion dictates that the brain consists of the right hemisphere, which controls the creative and imaginative functions, including spatial awareness, musical skills, motor control on the left side of the body and emotional context. The left hemisphere generally is associated with logical and analytical thinking, including speech, logic and reasoning, mathematics and motor control over the right side of the body.

A large bundle of nerves called the corpus callosum connects the two hemispheres, allowing them to communicate with each other. Well, that’s what they told me, anyway.

Frankly, I am not so sure of this with my own brain. Tongue in cheek, perhaps, but my two brains seem to act as distinct, separate entities. Each can justify anything. They seem to be all too often at odds with each other. My left side is fairly intelligent, can comprehend and reason. It can undeniably argue why I should or should not do something, such as place a trade. All very valid, I may add.

But my right side, the emotional brain, seems to take control of everything, and invariably gets me in trouble. All too often, I may add.

When I look back at all the stupid things I did in my life — and there were plenty — you can be sure that my emotional brain was at fault. Every time. My right and left brains simply do not communicate. No interaction at all. Nada. Perhaps my corpus callosum dried up with my misspent youth.

Until now.

When I finally recognized this dilemma, I committed to doing this one thing in trading: as much as I want to enter a position, I now require a conference of sorts with my intellectual side for permission. Like a marriage, I made a commitment that if I cannot justify, intellectually, the reason to enter a trade, I will stay out. There must be a valid reason. “Just because” is not a reason. Options trading does not facilitate feelings. Trading with emotions is a sure loss. Guaranteed.

When I trade now, I start with the feeling, the emotional need to enter a position. It could be a “fear of missing out” or greed, but I aspire to be in a position. It is a very strong sense that I may be missing an opportunity. But my intellectual side steps in and demands to know the basis of entering. Is the setup in place? Is there room to grow into my projected profit? Do I have the capital and acceptable risk tolerance? Do I have the time to allow for market fluctuations? Are the Greeks in line? Is the volatility acceptable?

A hundred questions will quickly run through my left brain before it will allow my right brain to continue. If the answers are not all supportive, I simply sit on my hands.

I have come to actively execute this exercise to ensure, as best as possible, that my trades work. At the very least, I should be aware of the risks.

We trade the SPDR S&P 500 (SPY). As outstanding as this stock is, with an amazing options structure, the risks are still there. And it is all too easy to lose your money. Unless you have an active system to assess your trades before you place them, you will soon be out of this business. It’s just that simple.

Try it. Before hitting the “buy” button, confer with your intellectual side. Even if for a few brief seconds. Ensure that the reason you are entering is totally supported by the criteria you established. When you have the endorsement of both your brains, you are exponentially more likely to succeed. How cool is that!

We can help you get started on the road to options trading success. Click the links below for details on our various programs.

Intro to Trading / Week in Review Sunday night webinar… 8 p.m., ET. It’s informative, engaging and even entertaining.

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Let us do the heavy lifting with two great programs: the DTS Signal and the Pick of the Day; both enjoying amazing success!

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The more you engage, the better trader you will be!

Create great trades,

Hugh