Using nature and natural eco and bio systems to style your trading

Discussion in 'Psychology' started by Boy Plunger, Aug 28, 2005.

  1. Ants communicate through chemical exchange. Trees atop mountains grow most of their foliage on the windless or south side. A river takes the path of least resistance. Small mosquitos specie have a larger prey base than larger specie mosquitos. The list is endless.

    I want to know how you use nature in your trading?

    Feel free to get creative and explain in detail the comparisons. I find that my best ideas in trading come from observing and studying nature and natural systems.

    It is no breakthrough because most highly successful systems are nature's reincarnations with leaps made to accommodate society but nature serves as the blue print.

    Thanks.
     
  2. I think Cluseau was dosed.
     
  3. Yes. That's it. I swallowed a puddle of liquid while the security guards weren't looking at jfk in '89. Never been the same since.

    Take off your sandals you dirty hippie and put on shoes like the rest of us. Until then stick to begging. At least you did something properly in thinking of your original handle.

    Now, with that out of the way do you have anything useful to say about my topic of interest?
     
  4. uh oh, I struck a nerve. You better head back outside to watch the path of the fire ants to regain your "equilibrium".
     
  5. Strengths and weaknesses are often two sides of the same coin. Nature offers many great examples of tradeoffs and efficiency.

    The elephant fears no predators (other than man), but moves slowly and needs massive amounts of food and water to sustain its bulk.

    The field mouse has to be afraid of just about everything larger than itself, but its food supply is nearly inexhaustible and it has a better chance of surviving harsh environments.

    The cheetah's main weapon is explosive speed, but the deployment of that speed is very costly, forcing the cheetah to carefully budget its energy reserves.

    Animals who adopt extremely well to the current fitness landscape might be considered the 'high earners' of that landscape, flourishing to a greater degree than their less optimized brethren. But these high earners are also the most likely to suffer when the fitness landscape shifts and changes beneath their feet.

    For this reason the hardiest animals usually have a survival strategy that focuses more on 'robust' than 'optimal.' King cockroach has survived for eons by moving in the opposite direction from gusts of wind created by potential predators.

    Perhaps the three biggest lessons nature teaches are

    1) stick to your skill set

    2) perform or die

    and

    3) take life for what it is.
     

  6. Excellent examples. I find the specialization of a sub set of specie to be remarkable and can relate this to the many type of financial traders that exist in the marketplace. I see how smaller creatures where able to survive and thrive beyond their larger counterparts and vice versa with differing environmental conditions. Some systems and animals are hardy while others are fragile.

    Your #1 is a good point and lesson about nature. Once you find out what it is you are it is best to stick with it and whatever strong points one has developed in that process.

    Unfortunately #2 is a bitter lesson i think most try to avoid unless they are faced with an impending critical shift in ability to survive or their survival pressure is non-existent until a drastic event(s) takes place. Some of our best predators thrive in stress conditions as do some of our best traders.

    #3 is heavily related to #2 imo. having almost died last week climbing a mountain life has taken on a new meaning once again...heh...

    Thanks for sharing your opinions on this topic.
     
  7. Well think of bumblebees and how it applies to trend following. There is a relationship. Pick up a book on bumblebees. It seems to be the closest natural metaphor to trading.

    So good books to read on the subject of behaviour include -

    Richard Dawkins - The Selfish Gene

    Darcy O'Thompson On Growth & Form

    Also intelligent link relating nature & architecture:

    http://www.architecture.uwaterloo.ca/frameset/ACSA/abstracts/abstractsAZ.html

    Indirectly related - Woody Dorsey- Behavioral Trading
     
  8. slacker

    slacker

    'Flock' behavior like birds or fish seem to also have a lot in common to market behavior. (IMVVVHO)

    Check out a great resource of some work done is this area at:

    http://www.red3d.com/cwr/boids/

    A lot of great information in this area on this page...

    Now how to translate into a trading system?

    :)
     
  9. Yes, much can be learned from studying a flock or pride or school or hive. Relating it to a profitable trading system?

    My viewpoint is that everything one learns relates to their trading in some way. I find examining certain natural systems to be beneficial when making one for trading. My intelligence eludes me at times and it takes an event like observing nature to give me an idea that is applicable in my trading style to enhance operations.

    Some would think this idea and me are out to lunch but i can live with this if one or two people share something that is helpful to me and my process.

    I am very competitive and aggressive at times so i can see how i could rub people the wrong way but that's life. My loyalty is second to none so my friends and associates have no problem with my arrogance and aggression because usually the situation warrants such an action. Believe me when i say they do not want any change in my ways. So if i run over a nun they're sure to think she gave me the finger. :D

    Sorry for the extra bit of chatter. I really appreciate you taking the time out to comment on this topic. Very interesting responses.
     
  10. This is probably the most intelligent and relevant threads I have ever read on ET. Keep it going. I just wanted to bookmark it. Thanks. Neal.
     
    #10     Aug 29, 2005