What does Stress, Emotions and Feeling have to do with Trading?
Money is made in the markets by following trends, buying low selling high. You hold on to your winners and cut your losers. It is that simple. Or is it? In theory yes.
In theory, there is no difference between theory and practice, but in practice there is a great deal of difference. Fear, Greed, Hope, Impatience, Anxiety get in the way. We are all emotional creatures. Our trading, our investing, our buying and selling (or not selling) gets us emotional. Your trading affects your emotions. How about the other way around? Do your emotions affect your trading? DO you stick to your rules and guidelines or do you twist your rules, make exceptions, hide your head in the sand, hope it all gets better?
The excuse some use is that markets always go up. Tell that to many who had to come out of retirement and had to find income of some kind to make ends meet. Tell that to many who were planning to retire but are unable to because of Global Financial Crisis.
Can you Trade Stress Free? What has Stress got to do with Trading? Nothing. At least that is how it should be. You buy low, sell high. The buying and the selling is what we call trading. When to buy and when to sell are both determined by a system. If your system is good, it makes money. That is call “Positive Expectancy”, you stick to the system and you make money.
What exactly is a system? A system has straight forward rules on what to do and when to do things. For example Casinos have a system that gives them an edge over the average customer. They may lose some of the time, but on average, overall, they make money. That is why there are so many casinos and that is why they stay in business. McDonald’s restaurants have a system too. That is how they produce identical food wherever you go. Franchises, successful businesses, great chess players, football teams, tennis and golf pros have systems also. That is how they keep on winning. Professional Traders, Super Traders have systems too. Whether they trade Stocks, Options, Contracts For Difference or Futures, they have systems. These systems give them and edge and when followed make them consistent money. Don’t fuss too much about the term “trader”. Investing and trading are similar activities. Investors buy and sell for growth and income. traders buy and sell, often more frequently, to capitalise on price movements.
Systems reduce or eliminate fear. There's a big difference between predicting that something will happen in the market (and thinking about all the money you could have made) and the reality of actually getting into and out of trades. If you are unable to trade without the slightest bit of emotional discomfort (specifically, fear), then you have not learned how to accept the risks inherent in trading.
Here are four primary fears: being wrong, losing money, missing out, leaving money on the table. Add to this emotional problems: lack of confidence, lack of discipline, improper focus, unwillingness to create or stick to rules, failure to take responsibility and addiction to random rewards.
Knowing what to do is the first step. Knowledge comes from studying. Technical or Fundamental Analysis give you criteria to analyse and make decisions on. The second and more important step is to do what you know. That requires practice. How do you practice when you have fears, doubts, past hurts and losses and information coming from all directions: Bull Market, Bear Market, sideways market, buy, sell, hold... One can also get very emotional, trade more by feel, break their rules, take profits early, let losses run, get distracted, not make any decisions, over trade, close up and countless, emotional, irrational and stressed mistakes.
Our aim at Trading Stress Free is to provide you with tools, techniques, programs, systems, coaching, seminars, and training for you to remove Stress from your buying and selling decisions. We are here to help you with your thoughts, feelings and emotions so you can potentially perform at the same level as professional and super traders.
In order to improve your performance you first need to Recognise where you are at, your strengths and weaknesses. You then use tools, techniques, programs, systems, coaching, seminars, and training to release what is getting in your way. You finally Re-Focus on your System, buy and sell when it tells you to. This way you reduce and eliminate Stress, Fear, Greed, Hope, Impatience and Anxiety. This allows you to have more time, to live the life you want with your family, friends and loved ones, to enjoy the finer things in life. You have the security, safety, comfort and peace of mind.
We provide FREE Resources (see the right hand column), FREE newsletters (click on the button to the left, email and face to face coaching, workshops, seminars and home study programs. A good starting point is to download and watch the “Nine Pitfalls and Nine Success Secrets” Resource. We look forward to being your trusted advisor on your journey of Financial Abundance and Freedom.
This website and all materials contained herein are published by Internetworking Pty Ltd, t/a Trading Stress Free (ABN: 87 050 569 250), being the holder of Australian Financial Services Licence (number 402043) issued by the Australian Securities & Investments Commission. The presentation and information contained herein are of a general nature only, and do not take into account your personal objectives, financial situation and needs.