Traders In A Trance

First the wave hit Raj K. Bhatia, currency trader. It was like an ocean wave, and it washed out of him all of the stress, all of the anxiety, all of the tensions that come from gazing at computer screens and making decisions and buying and selling. Then he walked into a garden, and it was the most beautiful place he could imagine. He remembered how it was to be a child, and to feel a blade of grass. He curled up beside gently gurgling waters, and he felt the comfort of the earth beneath him.

"Earth, air, sun, water, all combine their primal forces to give you courage, strength, and confidence," said Ruth Roosevelt, hypnotist. It was a chilly Thursday in early November, and Bhatia was reclining, apparently dead to the world, on a couch in her lower Manhattan office. "Now, Raj," she continued, "you know you have done your homework well, as you have throughout life, and you have developed systems for trading currencies. . . . You can change the system, but at any given time you can trust the system, because you have done your homework . . ."

BIG FREEZE. Welcome to the Wall Street Hypnosis Center. Yes, a controversial therapeutic technique that has gained acceptance over the years, usually to help people do things like quit smoking and lose weight, is finding a new clientele amid the canyons of Wall Street. Traders may smoke themselves blue and overeat to the point of explosion; that's usually O.K. so long as they are making money. But all too often they will freeze at the trigger, and a gyrating market blasts them to bits like an Old West gunslinger.

The problem is fundamental and can be found among even the best traders: They are human beings. As such, they have emotions that get in the way of their ability to coldly and swiftly commit or withdraw cash in the markets. "Your stored-up emotions can make you behave in a fearful way. You might be unable to trade at all," remarks Van K. Tharp, a North Carolina psychologist who specializes in counseling traders.

In hypnosis, the subject is put in a trance, then gently coaxed into a "posthypnotic" course of action upon awakening. Some psychologists are skeptical about the value of hypnotherapy. Tharp, for one, favors other forms of treatment for troubled traders--but he acknowledges that hypnosis can be effective in the hands of a skilled practitioner.

Roosevelt is an old hand at both hypnosis and futures. Her fascination with the former began at age 12--when her mother warned her that "there was something called hypnosis, and don't let anyone ever hypnotize you." Roosevelt--the name is from her former marriage to a grandson of Franklin Delano Roosevelt--graduated from law school and worked on the Street, first as a broker and later as a futures trader at Prudential Securities Inc. Four years ago, while still plying her trades on the Street, she was certified as a hypnotist and "practitioner of neuro-linguistic programming" (a form of hypnotism) by the New York Training Institute for Neuro-Linguistic Programming. She went into mesmerizing full-time only recently, after leaving Prudential.

Her clientele is small but loyal, and the ones who would talk offered up glowing testimonials. For example: "Hypnosis curbed my impulsiveness as a stock trader," says one client, Kathleen M. Cuomo, president of Equities Trading Corp., a Manhattan brokerage. "Sometimes things get pretty hectic around here, and it's easy to trade without really thinking."

For Bhatia, the problem isn't impulsiveness but the opposite--overcaution. He is president of New Generation Capital Management Corp., a small futures-trading boutique in New Jersey. Bhatia bases his trades on a computerized trading program that he designed himself. In September, when the British pound collapsed, his program worked--but his nerve failed. He shorted the pound at $1.94; it eventually fell to $1.50, but he covered at $1.85 even though his trading system predicted that the best was yet to come. "There was no reason to go out of it," Bhatia recalls, "except that there was all that money on the table, so why not take it?" He went short again at a lower price but lost some $90,000 because if his temporary lapse of will.

`FEEL THE CHAIR.' Bhatia sees Roosevelt about once a week and pays $100 per hour-or-so session. Recently, in his fourth session, he was transported back to the trading room. "Feel the chair beneath you," said Roosevelt. "You hear the beep, and you see the signal, and you feel good about it, and you pick up the phone, and you put in the order. Do it now--hear the beep, see the signal, see what it is telling you to do, pick up the phone, and enter the order. Each time you do it, it gets easier and easier. . . . Whenever you touch your thumb to your forefinger, a feeling of confidence will suffuse your being."

Well. . . it's starting to work for Bhatia and is already saving Cuomo, she says, from her own impetuousness. Hypnosis has persuaded her not to trade beyond her means and to stay out of the risky options market, even though she relishes the action there. And when the trading craziness begins--"I just snap my fingers," says Cuomo, "and say to myself, 'Am I stressed, or am I alert?' " It's all a byproduct of that beautiful garden--and on Wall Street, nothing is more comforting than a gently gurgling stream of profits.