Home Advanced Psychology and trading Take Away your Fire while Trading

Take Away your Fire while Trading


You have just seen how disastrous stress can be for your trading. What are the possible things you can do to minimise stress? Stress management techniques can assist you in overcoming anxiety. If you are losing money in the market on a consistent basis, then stress could be one of the reasons. You should never ignore the possibility of stress being the problem.

You have a choice

If you are facing stress-related problems, then you have a lot of options to eliminate stress. The various options would be:

Ignore the problem and be hopeful that it goes away

This isn’t necessarily a way to eradicate stress but to a way to escape from stress. Most traders chose this option, and they keep on losing money. This is equivalent to overlooking stress. You are actually giving an excuse.

Not allowing stress to affect your trading performance

If you have to be in a fire, wear insulating clothes. Stress protection measures have to be adopted. They are like taking pills when you are ill. The measure can only reduce stress but the cause of stress. Nevertheless, it is also necessary. It will at least teach you to make better decisions under stressful conditions.

Change your beliefs and attitudes about the stressful event so that it is no longer a problem for you

It is like putting out the fire around you. Beliefs are not reality. They are just your perception. Some beliefs are useful, while some are destructive. If you can identify beliefs which are destructive, then you can eliminate belief to a great extent. It is also challenging to do so at the same time. People tend to resist change, especially when it comes to the belief system.

Avoid situations which cause stress. If you are sitting near the fire, try moving away from fire

If you are feeling trading stressful, take a break. Unfortunately, people give a number of excuses for getting into these situations. Traders would rather face the consequences than staying out of it.

Lastly, a simple choice would be to reduce your risk exposure

Be out of the market or lower your risk substantially until it is no longer a threat to you. You can also lower your risk by following money management principles.

    • Reduce using higher leverage.
    • Diversify your account by allocating funds to different investment options.
    • Know the probability of success of each trade. And try to improve the success rate.
    • Constantly monitor your position and risk.

 Do you really want to get out of the fire?

If you still don’t know what your fire is and what is causing the problem, then it would be wise to follow the below-mentioned steps:

  • Make a list of the events that cause stress. By doing this, you can determine the choices you have to the fire.
  • What is the reason behind not selecting an alternative? These obstacles might overtake your winning attitude for the moment in your life. However, you are progressing just by realising what the stressors are and the choices that are keeping you in the fire.
  • Getting out of the market, socialising yourself, or finding a better job could be some of the immediate actions. Taking small steps are necessary before going for the large ones.
  • Make plans to implement the steps today. Take a part of the step each day. Do it right now!
  • Hang the list of choices in your bathroom. Read them every day until you thoroughly understand the choices you are making.
  • Larger can be slowly taken later. You can do this once everything becomes more evident to you. And you can once again examine your goals.

Set goals to get out of the fire

Although most traders have a goal to make a certain amount of money, process-oriented goals are probably more useful for traders. You should have the goal of developing a sound game plan and trading without committing mistakes. Your mistake could be not following your rules.

  • Your goals should be quantifiable– Set very specific goals. By just saying you want to be a successful trader, this does not define your goal properly.
  • Set both short term and long term goals– Goals that you define keeping one-month perspective, might be the stepping stone for goals that you wish to accomplish in five years.
  • Try this exercise to determine your goals– In the next two minutes, write down all the goals that you wish to achieve in the long term. You can include other areas as well. When you finish listing, prioritise them.

Have a plan to achieve each goal

It is easier to plan when the planning stage is broken down into multiple stages. Develop a tactical plan for each step. Another important rule to keep in mind is not to allow any criticism. Criticism blocks creativity. Look at each stage from all possible angles. Never underestimate the value of planning. Planning strategically can save you weeks of time.

Prioritise your time

When you prioritise, you get closer to your destination with a minimum amount of stress. Failure to do time management is a barrier to your goal. Prioritising becomes easy when you have ordered goals and have developed a plan against each of them. Block interruptions as much as possible. Do not even entertain unwanted visitors or phone calls. Most executives do not like interruptions.

Final words

The best solution for stress reduction is to “get out of the fire”. Do not run away from problems; instead, learn how to deal with it. Set your goals by writing it down on a paper. Develop a plan for each goal. Prioritise your time so you can carry out your plan. You will be surprised to see how easy it is to reduce stress. Get out of the Fire, now!


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