You have power over your mind – not outside events. Realize this, and you will find strength.” – Marcus Aurelius
The weakest part of any trading system is the trader themselves.
To be a successful trader, you must manage yourself. The ability to manage your own physical, emotional, mental, and spiritual health will go a long way in determining if you can maintain the energy and drive that it takes to be a consistently profitable trader, over long periods of time. Like so many other areas of life, I suspect that over 90% of traders fail to be profitable because they fail to manage themselves. They fail as traders because self control and self discipline are the key traits of a successful trader.
- So much is written about the dangers of financial ruin because of trading too big, but little is written about the risk of emotional and mental ruin by trading too much, or without a balanced life. A trader can still make a comeback after blowing up a trading account, but there is no coming back from personal ruin and permanent loss of hope and belief in themselves as a competent trader.
- You must run your trading like a business, scheduling your “on” and “off” hours. This includes your family, who should know when you are available and focused on them. You must always be sure to schedule quality time with your significant other, children, friends, and family for optimum emotional health.
- You need to have hobbies, recreation, and games that help you forget you are a trader for awhile; allowing you to recharge your batteries and return refreshed and ready to trade.
- You must be able to leave your trading results at the trading desk, and not allow them to bleed into your personal life. The best way to do this is to trade a position size that keeps your emotions manageable.
- A trader needs a diversified life, with trading as just one part of it. Having a healthy family life, friends, hobbies, exercise, and good nutrition leads to a balanced personal portfolio of time and energy. This helps to keep trading in perspective.
- Having a great group of trading friends helps you remember that you are not alone, and that others share your journey as a trader. The camaraderie is very healthy, and it is great to have someone that understands your ups and downs.
- Your significant other needs to have the confidence and faith in you, that we will be successful in trading. They need to understand the risks involved in trading, and our money management and our winning percentage. It is still the trader’s job to ensure the family’s needs are taken care of through the proper safety nets. Most traders will make a living and pay bills by other means.
- Only a trader’s passion and work ethic will take them the distance. Trading is not for everyone, but it can be richly rewarding for those that put in the time and run the race with all their heart, focus, perseverance, and drive. We must remember that we trade to create a great life, and not live to trade.
- A trader needs a spiritual aspect of their life to keep them centered. Whether it is a belief in a higher power, prayer, mediation, or mindfulness. A trader has to have access to a part of themselves that is much bigger than trading.
It is not trading or profits that make us better people, as much as the lessons and principles we learn from our trading, that can help to strengthen all areas of our lives, and make us whole.
