Crucial Tips To Control and Manage Stress Effectively While Trading

Trading is one of the most rewarding jobs in the world. It offers the freedom and flexibility that you can never expect in your typical day job. But as they always say - "with great power comes great responsibility." If not anything else, trading is a constant fight between you and the financial market you trade. As a job that requires your complete attention, it can get monotonous and pretty stressful.   

You will come across situations where you spend hours developing a trading strategy, back-test it in a demo account, and finally, applying it to the live markets only to see a disastrous failure. What would you do in that situation? Do you go back to the drawing board to see where you went wrong? Or turn off the system to take a walk? Both are great options except for the third one: feeling demotivated, stressed, or going on a revenge trade. 

It is important to stay super attentive when you trade. Feeling the stress is that one thing that takes the focus off your mind. Therefore, you must know that not trading is better than trading the markets with a stressful mind. Stress is inevitable in trading, and humans aren't sophisticated machines to stay focussed all the time. 

We recommend you follow the below practices to effectively avoid stress when you trade the global financial markets.

Have No Expectations: You should have absolutely zero expectations from the trades you place. This might sound dramatic, but it is true - expectation is the primary source of disappointment. It is important that you work on your strategy and do everything right to end the day with profits but do not expect that. If you do so, and the outcome is different, you will be stressed and dejected. 

Take Calculated Risks: One of the most common mistakes we make while trading is "wishful thinking." Do not risk your account and be certain about hitting the "take-profit" in a world of uncertainty. You won't be stressed even when the outcome is not in your favor when you take calculated risks. 

Prepare: Imagine attending a must-crack interview in a Fortune 500 company, but you hardly have any relative experience. Would you be stressed or relaxed? Obviously the former right? The same applies to trading as well. When you know what to do in a certain situation, you won't be stressed when you are prepared on how to react to it. Always stay prepared!

Accept The Reality: Trading is not about winning vs. losing. It is about winning more and losing less. So when you fail, instead of feeling discouraged and stressed, accept the reality. See what you can learn from that mistake and make sure you won’t repeat them ever again. 

Avoid Self Sabotage: As humans, we tend to find the easiest and more temporary ways to feel relaxed. Consuming caffeine, smoking, and drinking are a few toxic things traders prefer to avoid stress. Although you find instant relief doing these, ironically, they increase your stress levels in the long term. You know the harmful effects these habits will have on your health. Hence, I suggest you practice healthier alternatives to avoid stress. Meditation, regular exercise, and spending quality time with family and friends can do wonders for your mental health. All the best!