Archive for the ‘PAR journal’ Category

Weekend reflection process

April 6, 2013 Leave a comment

a depiction of Sun Wukong wielding his staff

a depiction of Sun Wukong wielding his staff (Photo credit: Wikipedia)

RJ: the asker of great questions, asked:

Hi Ken,
Do you have anything written on a weekend review process for a trading journal and trade chart markups?
Double loop learning requires review of work but I don’t have a well-defined process for weekend reviews.
I searched the chatroom and your essays but either didn’t use the right search terms or just didn’t find anything written.
Could you recommend some reading or anything else so I can develop an effective weekend process?
Thank you.

I replied: Try this on: this is what i find myself doing, over and over until someday I get it right:

0. Center ourselves on who we are and feel gratitude for the gift of life and consciousness to reflect on the wonder that is our Self and the world around us
1. Accept who we are and our desire to improve
2. Review what we aim to know, to do, to be (review goals and objectives)
3. Review the facts about what was done, including detailed performance stats as part of our ongoing study
4. Observe the slope of the trendlines and the volatility of our performance (all our trades and all our actions and all our feelings)
5. Review the forms and checklists to ensure discipline was performed; what did we overlook, where did we take shortcuts, and why?
6. Look for moments arising from the facts that seem to be important, trusting in our intuitions to nominate reflections
7. Follow the trails of reflection, connected to facts
8. Identify the A HA! moments
9. Conduct the 4 part learning journal exercise (A Ha moment, Reflection, Commitment to action, Results)
10. Commit our spirit and self to the next cycle of the wheel of improvement which continues to turn

this is what happens when i start writing after reading from the book of tales of Sun Wukong (The Monkey King)


The power of water, and reflections on critical thinking

January 28, 2011 1 comment

A plot of the Q-function, the tail probability...
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A testimony to the power of water, in recent Australian floods.

Water level in rivers follows the Log-Pearson 3 probability distribution(see attached picture)

Tightly clustered around the mean, with little variation, and a limit on how far the left hand tail can go (ie “dry”)

The right hand tail though is much fatter than the standard normal distribution. Even though it remains a very low probability event, the consequences keep going; they don’t trail off to insignificance like in the standard normal

In forecasting and then living the future, we see something like the Log-Pearson 3 distribution in practice. We get accustomed to extrapolating from previous “normalish” experience which works so often that it becomes a reasonable technique and standard practice. Our monkey brain is poorly adapted for remembering the lessons of fat tails and properly estimating their effect on our plans

When the underlying process though is NOT a generator of standard normal, but rather has elements of chaos and uncertainty in it, we can get to experience the surprise of consequences which conform to power laws: unpredictable as to frequency of occurrence or seasonality, and unpredictable in terms of magnitude of consequence.

Our monkey brain will tend to discount the early indications of potential disaster as a combination of a number of well-known biases and fallacies. Remember that cognitive biases get turned into fallacies when you start experiencing the consequences. Ask the guy holding the camera in the video clip.

We often can’t know the degree of chaos in the underlying process until we discover results that suddenly and stubbornly refuse to conform to standard normal expectations.

In digiworld you get do overs.

In realworld, you get the opportunity to learn from other peoples’ catastrophes; you don’t get to learn from your own catastrophes.

This is the basis for Nassim Taleb‘s (“Black Swan”) discussion of 4th Quadrant problems: when our statistically based insights can actually expose us to far more risk than standard models can/will describe.

Taleb’s advice on living in the 4th Quadrant: What Is Wise To Do (Or Not Do) In The Fourth Quadrant

1) Avoid Optimization, Learn to Love Redundancy

2) Avoid prediction of remote payoffs—though not necessarily ordinary ones

3) Beware the “atypicality” of remote events.

4) Time. It takes much, much longer for a times series in the Fourth Quadrant to reveal its property.

5) Beware Moral Hazard.

6) Metrics. Conventional metrics based on type 1 randomness don’t work in the Fourth Quadrant.

An executive summary of complexity theory

January 6, 2011 5 comments

A system with high adaptive capacity exerts co...
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An executive summary of complexity theory

Johnson, N. (2007). Simply complexity: A clear guide to complexity theory. OneWorld Publications, Oxford.

Futurists are in the business of providing a structured vision of the future that includes variables, dynamics, processes, themes and values by which the future will unfold and how we can be successful getting there in our  journey along the way.

Every futurist I’ve encountered describes the increasing complexity of today’s world and the certainty that the complexity will only increase going forward. I thought it would be useful to summarize the best book I’ve found so far that describes complexity theory in a useful way.

Complexity theory is a discipline that ties together phenomenon like: traffic congestion, the collapse of financial markets, avalanches, terrorist attacks and networks, pandemic viruses and cancer.

There is understandably senses definition for a theory which proposes to manage the unmanageable, or cleanly defined the undefinable.  Neil Johnson offers the following working definition which is a reasonable start point for approaching this topic:

[complexity theory is ] “…the study of the phenomenon which emerged from a collection of interacting objects.” (Johnson, 2007, p.3)

The theory is especially concerned with groups of actors that are interacting by competing for resources.

It’s fair to ask of the theory of complexity: will it help us understand, predict and control complex situations?

Emergence is an important topic: it deals with behaviors and or qualities that arise without warning, without apparent central control and are properties of the entire system and environment and not of individual components. The wetness of water can be considered an emergent property or the flocking behavior of a large group of birds. Both have qualities and properties that cannot be found in individual agents.

The idea of emergence includes the idea of emergent design through adaptation to dynamic conditions. Consider the case of DNA versus intelligent design. Evolution by adaptive DNA is without apparent central control and develops without warning and usually in unpredictable ways with unforeseeable magnitudes of outcomes;  intelligent design takes the opposite position in every way: central control according to a pre-established plan that goes according to design with foreseeable and specified outcomes.

Johnson offers the following components and behaviors that seem to apply to most complex systems and situations.


  1. The system contains a collection of many interacting objects.
  2. The behavior of agents/objects is affected by memory or feedback.
  3. Objects/agents can adapt their strategies based on memory or feedback.
  4. Exists in an open system, affected by the environment.


  1. the system appears to be alive.
  2. Filled with emergent phenomenon that are surprising and can be extreme.
  3. Absence of an invisible hand or central controller.
  4. There is a mix of orderly and disorderly behavior.

Thanksgiving reflection

November 23, 2010 6 comments

"Bridge of no return" in Panmunjeom ...
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a friend of mine has a son in the Army stationed in Korea.

he called home last night to tell his mom that if he didnt call home on Thanksgiving day not to worry, just that he would be in the field

his dad (a retired officer) got on the phone to chew his ass for talking about operational information over an unsecured phone line

just a father and son, sharing the love 😛

a lot of guys in my department are in that position

a number of the guys i was teaching this morning, upon graduation in 10 days will be assigned to duty in Korea next, in the normal course of events

i never have problems with my students being motivated to learn

It’s a real privilege to share classroom time and space with them

some folks don’t understand why i dont just trade full time; it’s hard to explain perhaps. but not really

it’s my dharma to teach here

dharma = soul/life duty;  one’s “righteous duty” in the Hindu tradition

in 1985 on Thanksgiving Day, I was a 1st Lieutenant of Infantry, serving inside the DMZ in Korea, as the commander of Guard Post Ouellette, the most forward deployed unit in the Army, an arm’s length from N Korea; at 3AM, as was my habit, I was walking through the trenches (15 feet deep, carved thru rock) going around the perimeter to inspect all of my fighting positions, each one in the dark, filled with 1-2 guys on duty, on the lookout for infiltrators or whatever madness the N Koreans might be up to

in one of the bunkers i met my newest soldier, who had reported the night before, fresh from basic training; he was 17, and from Missouri, and this was the first time he had ever been out of the state except for attending basic training at Ft Benning

we watched thru heat-sensing night vision devices as a squad of N Koreans began infiltrating thru our sector; and per SOP, we reported it to higher and they began vectoring ambush squads and reaction forces to intercept

the rest of the night we spent in a pretty tense manner as the scene unfolded until just before dawn the squad returned to N Korea

the kid’s eyes were as big as saucers, and I thought about what it meant to me to be 28 yrs old, and in charge of 50 guys in that position, on Thanksgiving Day

that was the day i knew for sure that i was destined to be a soldier for as long as i could serve

never forgot that moment and what it meant to have that kid under my command and what my duty was

made all the hardships or sacrifices or whatever pretty easy to take

in fact made all sense of hardship disappear, because it was absorbed into the value of “duty” and service to others

so, I never ever saw service as a hardship or particularly difficult; it all seemed very natural as a part of my dharma

I will be praying in my own way for soldiers this weekend, as they live their own duty to self and others

Traders Roundtable: six tangible benefits of reflective journaling

May 30, 2010 4 comments

Knowledge, mural by Robert Lewis Reid. Second ...
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Reflective journaling is the process of deliberately recording your thoughts and feelings and then analyzing them in a process called double loop learning.

With reflective learning, we examine our feelings and responses and then we look at how we act upon this newfound knowledge improving our self awareness and self-consciousness. Reflective journaling, them helps us to develop at to different levels simultaneously.

this growth and self awareness of self consciousness is important to the trader, because the individual psychology of the trader is such an important component of almost every kind of trading system. A shorter term your trading system operates in, the more important your psychology becomes. Reflective learning, therefore is an important component of building your traders toolkit.

Reflective journaling is a powerful technique for improving your reflective learning.

Here are six tangible benefits you can expect to achieve:

  • Your focus and attention will improve. Concentration and attention are important qualities of good traders.
  • You will refine your beliefs and develop an inquiring mind. Knowing your beliefs explicit label improve your ability to select trading systems that fit you.
  • You will exercise both your creative and critical thinking skills. You need to be creative to come up with new trading ideas, and then critical in order to find weak spots and blind spots and leverage points.
  • You will improve your discipline. Discipline will help you survive difficult times as a trader and will give you the strength of will to continue to execute under conditions of uncertainty.
  • You will learn to act on evidence that has been weighed and measures. Adopting a scientific frame of mind will help you eliminate emotions from your trading where they are harmful and what you focus on results instead.
  • You will be growing your body of knowledge. There’s no substitute for broad experience in the markets; you need diverse vacationing your portfolio and in your professional knowledge.
  • You will learn to make more and more distinctions. one of the definitions of intelligence is the ability to make more and more distinctions between concepts, context and situations.

Good trading!

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A reflection on charismatic leadership

March 20, 2010 11 comments

Gen. David Petraeus, the top U.S. military com...
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I am naturally skeptical about charismatic leaders, but I have seen its power in action.

Just before GEN Petraeus left our college to take command in Iraq he gathered faculty and students in our large auditorium, which seats 2500.

He spoke in a very relaxed manner, hardly the tone you might expect for a guy getting ready to take on the most politically sensitive mission around, one frought with peril, and which could go wrong in a thousand different, easily imaginable ways

It was surprisingly intimate moment, as he spoke humorously with and about his aide de camp and some of the other majors in his morning running group

he spoke frankly about the challenges ahead and the values we were going to use to see our way thru the fog and danger.

after about 10 minutes there was a palpable feeling that we were in good hands at the top and that we were going to prevail, and that if there a way thru the forest we were going to find it

it was the opposite of demagoguery, yet charismatic in its own way in that it was authentic, and appropriate and somehow “fit” who we all were at that moment in time

So, I am intrigued by charisma, where it comes from, how it works, why it works, and all that jazz 😀

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Reflecting on self-directed leadership in a military college environment (an action research approach)

March 20, 2010 24 comments

schematic view of Curriculum in/out of school,...
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The purpose of this assignment is reflect upon my learning through this course and to describe what I am doing to provide for the development of leadership capabilities in those who look to me for direction and guidance. My professional work centers on preparing Army organizational leaders for a world of complexity and uncertainty, and specifically in designing a teachable curriculum that satisfies both the accreditation system and the needs of individual students and faculty. As a result of many cycles of action research involving a variety of stakeholders, I have been designing curriculum that seeks to maximize the opportunities for student and faculty Voice in all phases of the classroom experience, including: design, preparation, delivery, assessment and follow-through. Because the strategy represents a significant shift from the traditional methodology, I am finding many leadership challenges and opportunities throughout the program. I will explore a number of important themes and strategies in this paper.

Chaos and complexity theory point towards a need for multiple points of view and an accommodating culture and practice in order to account for uncertainty in the world. Leaders set the stage for an organization that seeks to thrive under these conditions and therefore become primary leverage points in setting the conditions for success. Because our students are not objects at a distance,  not third-party objects of study but rather thinking, feeling human beings with insights and experiences and discretion, we have shifted our design team composition to include routinely groups of students in the form of focus groups and co-researchers in the action research tradition. Incorporating students in the design of lessons that will be taught that academic year represents a paradigm shift.

I am shifting our feedback system to incorporate more qualitative assessments from both faculty and students. This is a departure from our standard practice of relying exclusively on quantitative instruments. Our new feedback system for programmatic assessment is much more from the mixed methods tradition, which seems to me to be central in going forward in our efforts to understand and appreciate complexity. My intent is that the mixed methods approaches in the classroom will expose students and faculty to this methodology as a way to prepare them with a useful tool beyond the boundaries of the college environment.

I am systematically pursuing outreach and connections with faculty and curriculum designers from other teaching departments  in order to establish a network-centric approach to integrated curriculum design. This is taking the form of a leaderless, self-directed workgroup, with group norms and processes emerging to take the place of formal assigned individual hierarchical leadership. This self-directed work group presents recommendations of consensus to the traditional leadership of the College and is proving to be more and more influential with each successful project.

Because collaborative and adaptive leadership represents a shift in the cultural and operational perspective of the college, students and faculty, it is necessary to build up a resource and reference base that can be used to justify and support our inquiries. We are building a set of wiki’s and blogs that are interactive in order to prepare for our new lineup of lessons, to support collaborative learning inside the lessons dynamically, to document the results of our in class inquiry and to expand the knowledge base both for future lessons and for the field force in general. There is evidence to show that our students and faculty are getting the hang of this technique. This is reshaping the way we approach lesson preparation and our resource base and it is carrying over into our distance learning and remote site teaching strategy. Remote site teachers now have access to our growing experience base on the wiki and blog and can use that in their classroom for air where they do not possess personal experience and expertise.

Finally, I am working with interested others in formalizing our new approaches into college policy and SOP in order to lock in our games in the college’s infrastructure. Without these changes, initiatives are only as enduring as the energy of the interested parties. By incorporating them into our explicit rules and policies, we can institutionalize changes and ratchet our way towards success.

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