Staying cool, calm and composed amid uncertainty, ambiguity and abstrusity can be preached by armchair critics, but when it comes to practicality and applicability, it is close to impossible. This is the life of any career trader and for some part-timers too. Some traders are virtuous enough to handle these situations with profound sanity while many succumb to the pressure and are prone to trading stress.
Why choose/stay in trading?
Despite all these animosities, still many choose trading over other careers. Part-timers can simply invest via hedge fund or investment banks and enjoy his comforting life, yet they chose to share the dread of sleepless nights. It is definitely not because of lack of career opportunities, as a matter of fact, many traders have some spectacular skills which can turn on any employer. It is because thrill, chill and sizzle associated with trading.
The ecstasy reached after profits can never be replicated by any sniffs and cracks. This divine feeling is the honeymoon period of a trader. Once the sizzle runs out, cumbersome starts to kick in. A trader will then start to realize that he has to pay his mortgages and bills every month by going through all these hassles. A part-timer, who started trading because of his belittle earnings, will also have cash crunch situations despite putting his effort in trading apart from his day job. These are the typical scenario of stress creeping into a trader.
How to identify trading stress?
Insomnia and stress are like Bonnie and Clyde, and so sleepless nights are the best indication of any type of stress. Sudden mood swings, feeling disconnected from the surroundings, idleness and laziness are the other predominant indications of stress. Watch out for the negative feelings and negative attitude towards life too, as a failure in trading can be iterated as a failure in life by many. Some therapists nowadays suggest sudden flu and digestive problems are even the outbursts of stress. In a nutshell, trading stress can be identified from any change in body, mind and soul.
7 Simple ways to handle Trading stress
Calculate your affordability
The critical reason for trading stress is that the amount locked as trading capital can mean a lot to a trader. A trader should know his worth and the amount of money he can afford to lose. Many traders misunderstand this notion and place a small stop loss for every trade, which results in a bigger cumulative loss. The loss-bearing capacity is usually 20-30 % of savings. Therefore, the ideal trading capital is this affordable meager portion. Unfortunately if the affordable is afforded, it creates panic and leads to revenge trading at times. So it is better to take some time off and make a stringent decision whether to continue trading or not. ‘Never go all in’- this can reduce the trading stress to a considerable extent. (Go through our article on how to avoid Forex losses for more details)
Workout – Body and mind
A good workout can take out the complacency and boredom in one’s mind and rejuvenate the desires and ambitions. A whole body workout in a gym can increase the blood flow to the brain and can re-invent a person but not everyone will have a passion for it. The best substitute can be running, swimming, yoga or any tough physical sport. Just a simple morning walk can ease one’s mind. A trader can also play games like chess or even sudoku to refresh his mind. These kinds of mental and body exercise can make a person mentally tough to withstand stress.
Have a let out
A trader living in the city or suburbs should definitely mingle with fellow traders and make frequent traders. Even if wisdom is not shared in those meets, sentiment and experience will be shared. It can be of great help when the market is going through a phase. When everyone makes a loss, the impact of your loss will subsidize, psychologically. Furthermore sharing the pain out loud with an understanding community can ease out the sufferings and notions a peace of mind. If a trading community is not physically accessible, a trader can join online forums and chat rooms too.
Multitasking can be amusing at first, but it takes a toll on the body and the mind as days progress. According to the recent studies made by many neuroscientists and psychologists, human brain functions at its best when it monotasks rather multitasking simply overloads the brain and shifts focus from one task to another. It decreases attentiveness and mindfulness, which in turn affect the productivity. Just recall your experience of analyzing too many charts. You might simply navigate without focus missing out the minute details. The best analysis made by you will always be the one which you mono-tasked, i.e. focused your attention on a single chart for a prolonged period of time and plucking out the minute cues from it, just like an artist. It also satiates your profound craves.
Belittle your expectations until settled
A trader can definitely get carried away by the initial success and increase his commitments. It takes a lot of time, skill and patience to get consistent payouts from the market. Until then, a trader should keep his commitments in check and grind his way through.
Spend time with your loved ones
Don’t shut out your loved ones in the name of discipline. Make a schedule for your loved ones within your tight schedule of trading. Stakeouts and make outs with your beloved can’t be substituted with anything. It eases and refreshes the mind and brings the true-self to the forefront. On the contrary, avoiding loved ones in the can even lead to stress many a time.
Learn to take it on the chin
Remember, there is no gain without pain and the package of thrill and chill does include taking it on the chin. The losses are part of the package and hence it is better to trade with an affordable capital. The bearing becomes easier. But do analyze the mistakes and avoid it in the future. Take the loss as it is and move on to the next trade. Always remember, all it takes is one good trade to get back on track. So take it on the chin just like a boxer and wait patiently for the ideal set up.
Calling it quits
A trader should always remember the reason for his trading. It is for the thrill and chill (of course for money too) but when the sizzle goes out and trading becomes a hectic job, it’s time to call quits or seek professional help. The professional help can be of a therapist or even a trading expert. (Get the best indicator for forex, Pipbreaker or trade using our free Forex signals.)
Despite the fact that trading is one of the most stressful careers in the world, many take it up for the joy and ecstasy.
Choose the capital wisely, keeping in mind your affordability to lose.
Make a routine to workout daily – for body and mind.
Associating with fellow traders and sharing the struggles and worries out loud lessens trading stress.
Multitasking can be a curse and it can only invigorate trading stress.
Keep your expectations minimal and spend quality time with the beloved.
Learn to take losses as part of the game.