Stress: The nature of the beast

Stress comes from both external and internal forces with the latter being the only one we can control. As a market participant, there are stressors you can control but overall the profession is stressful. stressIn other words, control what you can and accept the fact that trading is stressful.

A few common examples of stress that I’ve seen are the stress of anticipated failure, where there’s a lack of self-confidence and trading becomes wildly inconsistent, and the stress of unpreparedness, where the lack of preparedness lowers the probability of success. Both of these examples are ones in which we have control over and thus can be managed.

Managing stress is not rocket science yet so many fall victim. There are numerous ways to manage stress, the trick is finding the motivation and the sustainability needed to be successful. Here are a few items that should get you started: [headline][/headline][list type=square_list]

  • Caffeine-a crutch, becomes a need to “focus” or “get centered” when in fact it’s not
  • Diet-weight gain is common in high stress. Have a balanced diet
  • Exercise-research is rampant on the impact exercise has on stress…do it
  • Sleep-the body needs to rejuvenate as well as the mind. Sleep is fuel for body and mind
  • Outside market activities-get a hobby or something that allows your creativity to grow
  • [/list]

For those external forces of stress that we have no control over we are not helpless. What I mean by that is that the way in which we react to stressful situations is still a choice. We may not choose to be in a bad trade but the way we manage the trade is still our choice. Keep a cool head and don’t become frustrated.

Frustration is a direct result of how we react to the event that’s causing the stress. Frustrating a particular learned behavior causes us to revert to an earlier learned behavior. In trading this can be a severe roadblock to success as it stymies growth. So the trade sucks and you were wrong. You did have an exit strategy, right? If not, then the stress of unpreparedness has paid out in spades.