It is impossible to avoid all stress. Unfortunately, it is just a part of life. Obviously, as any doctor or health professional will tell you, you should avoid stress and stressful situations as much as you can. Naturally, that is easier said than done for most. So, what can we do to avoid stress? I have a few thoughts for option traders that can apply to everyday life too.
Can’t Avoid It Entirely
We all have some amount of stress in our lives, but when you find things are extra stressful you should consider taking a break from trading. Sometimes when people are stressed they use trading as a potential stress reliever. They might feel the high from profiting on a trade or trades will take away some stress.
Extracting money from the market is difficult enough with a clear mind, but adding stress to the mix and hoping a good trade will alleviate some of that stress makes it almost impossible. The pressure traders put on themselves to make money or have a “winning” trade can cloud their judgment. This allows the “emotional” trader to make the decisions, which usually does not end well. The good news is there are a few things you can do as a trader to combat being stressed.
Say Yes to a Trading Plan
It is so simple but still hard. Have a trading plan and follow it. We have talked so many times about this in the past. You need a plan to make decisions easily and with limited stress. Trust me, nothing takes away stress more than having a well-thought-out trading plan that you actually follow. Notice the last word of the previous sentence. You have to follow that trading plan otherwise it is not going to help.
Take a Break
Something simple you can do to relief stress as a trader is to take some time off. Taking time away from any activity that produces even more stress is always smart. I constantly see traders who think they need to trade all the time, especially those who trade full time. The market will always be there. Yes, you cannot make money if you are not trading, but if you stressed what is the likelihood you will be successful? You guessed it, not very likely.
Have you ever meditated or thought about meditating? A simple meditation routine that you can get for free almost anywhere can relieve stress and not just about trading. Even a few minutes can do wonders. It may be difficult at first or to hard to find the right time, but I guarantee it will help if you are consistent … just like being consistent can help in your option trading.
Do Your Best
There is no way to control stress completely, but these suggestions can help. The bottom line is that even disciplined traders should take some time off when their stress levels are extra high.
Senior Options Instructor