Traders should never underestimate the role that stress plays in trading. Most will succeed or fail based on their ability to handle stress, rather than how many winning or losing trades they have, or even how good their methods are. It is possible for a trader to win consistently and still not be able to win in the long run, because they can’t get comfortable with their own inner dialogue.
If you are going to be a successful trader you will need to manage the weakest link in any trading system: yourself. No matter what your strengths are, stress management is your weak spot, and you have to be able to overcome your own personal limitations if you want to be a successful trader.
Here are the ten ways to manage your stress in trading:
- When you get too excited about a trade, calm down by practicing breathing exercises or meditation techniques.
- Never trade so large that one trade will make or break your account, trading career, or lifestyle.
- Only trade systems and methods that you fully understand and have faith in.
- Visualize yourself being a successful trader.
- Slow down your pace to a level that does not rattle your nerves.
- Connect with like-minded traders that understand your goals and challenges.
- Develop unshakable confidence in yourself by constantly studying the markets.
- Stop doing what does not work, and start doing more of what does.
- Don’t let others rattle you, and stick to your game plan.
- Accept your losses quickly when stops are hit to avoid emotional and monetary damage.