Dealing with Trading Stress



The business of trading can be stressful.

Recent market events required our firm to hold substantial exposure through a troubled geopolitical environment, and it was stark reminder of the importance of stress management for long term trading success.

stress of trading

It’s not the fear of getting caught out. As traders we all must accept that the associated positions could drop to zero at any second. There are things you just can’t account for and nobody is gonna fault you for taking a hit on a true black swan.

What makes it so stressful is the constant need to pay attention. Getting wiped out in a flash crash event is one thing, getting wiped out because you were slacking about when you could have done something to avoid it? Yeah, that’s just unforgivable.

Unfortunately, the market and its gyrations aren’t the only things that make the business stressful.

All business is stressful to one degree or another. There are always contentions for time and resources. There is never enough of something. Someone is always unhappy. Something always desperately needs to be done.

There’s a reason people generally don’t provide details about their performance or brokerage statements; even when they have good things to show. Putting yourself out there when you’re doing well is great. It feels good and everyone loves you for it. But you know the second you make a mistake or start to underperform, certain elements of the public will pounce with vicious intent.

C’est la vie.

I use that term often. It’s a commonly used French expression meaning “such is life.”

It’s appropriate in many situations because, despite what most people think, the life of a trader isn’t all sex and candy. There are lots of things that suck and we would all prefer not having to deal with them, but that’s life. You either find a way to deal with life as it is, or consign yourself to perpetual disappointment.

I personally deal with the stresses of life in a number of different ways. Not all of which are healthy.

One of the better ones I’ve found is hiking. I try to do it as often as I can. It’s usually just me and my dog, though I can occasionally get a buddy to join.

In either case I find that it allows me to slow down my thoughts and think deeper about the stresses in my life. Once I get in that mental state, it doesn’t take long before I’m back to calm and confident thanks to some better solution to my problems.

Everyone is different of course and there is a good chance that hiking isn’t your thing. No worries.

It’s something to think about though. Even if you never try hiking, having a trading career is going to require you to have a reliable way to deal with stress.

Just try to find something that allows you to clear your head without leaving you ripped up the next morning.

You need to be on point for that pre-market data after all. ;)

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