The Hour Between Dog and Wolf: How Risk Taking Transforms Us, Body and Mind Paperback – Illustrated, September 24, 2013

What an amazing read. The first time I have seen someone connect biology and trading, and make such amazing and convincing arguments and observations in the process.I think this is a must have in any traders bookshelf. When you want to take a break from charts and financial analysis, pick this one up and you will learn important information.The book is all about explaining what is happening in our body when we trade. A behind the scenes look that shows how our nervous system combined with hormones interact with our body and what happens when we trade.What happens when we take on risk, when we manage the positions, take on more risk, etc. What happens when we succeed wildly and also when we crash badly.The book ends with some high level policy advice that I agree: markets would benefit from increasing the number of women and older men participating in them. It also has much advice at an individual level, how to condition yourself to become better at handling stress.All in all, loved this book!

I have the Kindle version. It took 6-7 hours to read. It's well-written and well researched. At times it told me a little more about the brain's workings than I wanted to know.The author argues that Plato drew a sharp distinction between the mind and the body; Aristotle recognized much more interplay between mind and body. Using risk as his tool, the author makes his case that Aristotle had it right.The author has worked on Wall Street and his descriptions of risk in the context of investing are fascinating. He describes the effect of the hormones testosterone and cortisol on the body when Wall Street traders invest hundreds of millions of dollars. He makes a convincing argument that the body affects the mind.Also as an academic, which he now is, the author also reviews brain's mechanisms for handling hormonal influences and processing information. When investments go badly and risk turns out poorly, cortisol can flood and affect the mind's willingness to accept risk.If the topic interests you as it does me, I recommend the book. The author makes a convincing argument that Aristotle's position was superior to Plato's.

I found this book both informative and entertaining. I'm a full time futures trader myself and have been genuinely curious, like the author, about the effects of stress on decision making under uncertainty. I wondered if it could be considered chronic mild stress, or worse, chronic acute stress. The author provides a lot of information about the science behind a not well known profession (in terms of stress). Additionally, I found the book entertaining beyond the science with his personal stories in the market.

Investors are well served by studying behaviorial and decision-making psychology broadly and then selectively transferring that knowledge to financial markets. Arguably, the most influential readings come from authors who are not directly involved in financial markets. For example, the Psychology of Intelligence Analysis by former CIA staffer Richard Heuer captures the pitfalls of making decisions when faced with incomplete information. Stepping back further, to readings about the emerging discipline of neuroeconomics, requires a basic understanding of brain science and physiology. There are some useful layman's guides to these subjects, such as Brain Rules by John Medina but what's been missing is a book that ties together a cohesive explanation of why your brain and physiology drive your behavior and how this collective impact can translate into a greater understanding of market behavior. The Hour Between Dog and Wolf succeeds in this objective. Using both plain language and vivid trading room stories, author John Coates has written an important book for finance industry professionals who want to expand their understanding of the biological underpinnings of behaviorial finance.The book's fictitious examples of trading floor scenarios are particularly effective. Science always becomes more interesting when its explained with personalized situations. Coates has succeeded in connecting the neuroscience with the behaviorial / cognitive psychology that's most relevant to investors. Finally, the 'suggested reading' section is excellent, a primer for further study that's accessible to non-scientists.