Dr. Indre Viskontas, a neuroscientist and psychology professor at the University of San Francisco, welcomes viewers to “Inside the Mind of a Trader,” a show dedicated to uncovering the mindset of successful traders. In this episode, she interviews Kathy Lien, a prominent figure in currency trading and co-founder of BK Traders. Lien is also a frequent contributor on major financial networks like CNBC and Bloomberg, as well as hosting her own Forex YouTube channel.
Lien began her journey into the world of trading at a young age, entering college at the age of 13. She reflects on how being a prodigy did not feel particularly different for her, as she has often been the only female and minority presence in her field. She attributes her success to a natural aptitude for learning quickly and adapting to new concepts, particularly in economics.
When discussing her trading strategies, Lien explains that her approach combines both fundamental and technical analysis to make rapid decisions based on market sentiment and incoming news. Her process, she says, is almost instinctual, developed over years of experience and oriented around habits that she practices repeatedly.
Viskontas reveals findings from brain scans conducted during Lien’s trading assessments, noting the increased activity in areas of her brain associated with trading compared to unrelated tasks. For Lien, the speed and efficiency of her decisions are crucial, as she embraces a methodical risk management process aimed at preserving her profits. She emphasizes the importance of developing a strong exit strategy and acknowledges the common emotional challenges that traders face, such as loss aversion.
Throughout their conversation, Lien delineates her priorities as a trader, focusing primarily on consistent, albeit smaller gains, and maintaining a disciplined approach. She discusses her methods for coping with the emotional aspects of trading, including taking scheduled breaks from the market to manage stress.
As an advocate for structured trading practices, Lien shares insights on how her experiences have shaped her trading philosophy, promoting the idea that understanding personal risk profiles and making calculated decisions can lead to long-term success in trading.
The discussion encapsulates Lien’s journey as a trader and highlights the cognitive processes that underpin her decision-making, showcasing how experience and strategy converge in the demanding world of financial trading.