Peter De Neve
Certified Public Accountant
And, unfortunately, that’s a pretty accurate description of the situation of the individual trader in today’s financial markets.
So it’s not surprising that some degree of psychological and emotional stress is an unavoidable element of every trader’s experience.
At its most extreme, this kind of stress can lead to serious consequences for a trader’s physical health.
We’ve all heard about Wall Street money wizards, managing millions of dollars of other people’s money every day, who burn out by the ripe old age of thirty.
Unfortunately, even for people risking much smaller amounts of money, the stress of trading can cause physical and emotional challenges.
Imagine the over-anxious golfer who finds himself unable to draw back his putter. Well, a nervous trader suffering a similar kind of paralysis is too hesitant to pull the trigger on a trade until the opportunity has passed.
Or perhaps the stress of a big loss compels the trader to gamble recklessly on new positions, risking a rapid reduction in the capital he or she has set aside for trading.
Less obvious, but just as debilitating in its effects, is traders who struggle to prevent the anxiety of having open positions in the market from spilling over into the rest of their lives.
California construction industry professional, Anna Pham, became interested in trading as a way of pursuing greater financial freedom, but initially struggled to cope with the stress of day trading while also working full time. Since her recent discovery of Total Alpha, however, Anna has felt more relaxed and assured. She has also recorded several profitable options trades. Moving forward, she plans to steadily build her knowledge and skills, one step at a time and is quietly confident that she’ll achieve her financial goals.
Garden Grove, California
Construction Industry Professional
Stress can be a frequent problem for part-time traders, as in the case of Anna Pham, a construction industry officer from Garden Grove, California.
Like so many busy professionals, Anna was attracted to stock trading as a way of achieving financial independence and perhaps one day escaping the grind of corporate America.Anna’s initial forays into the markets were discouraging.
“I tried another service for day trading,” she recalls, “but it made me so stressed out, I couldn’t focus at work.”
Stress is a common, yet rarely-discussed challenge for new traders, who often feel a natural compulsion to monitor every flicker of the screen while their trade is live.
Of course, this habit is not very conducive to work or, indeed, any other worthwhile activity.And nor does obsessing over open positions generally lead to greater profits.
Traders affected in this way are all too often tempted to abandon their trading plans by closing their positions too soon, moving stop losses or getting greedy and running winners for too long.
“I tried another service for day trading, but it made me so stressed out, I couldn’t focus at work.”
A great deal of anxiety is caused by a lack of understanding of why particular trades are being entered, which leads, in turn, to a reluctance to let the trade play out. And, of course, a trader’s anxiety can be exacerbated by taking excessively large positions.
The good news is, a clear understanding of the reasons for entering a particular trade combined with profit targets, supported by sound risk management goes a long way towards reducing trading stress.
Unfortunately, the problem of not being in control remains. No matter how solid your trading plan or finely-honed your skills, the fact remains that the market may at any time do precisely the opposite of what you expect it to do.
Lack of control over the markets is why even the most successful and experienced traders accept that a substantial proportion of their trades will be losses. And it’s why coping with uncertainty is perhaps the most important mental and emotional skill newcomers to the markets can develop.
Entire books have been written about how visualization, meditation, and other mental disciplines can help traders manage stress and anxiety.
And there are no doubt techniques like these have their uses, but the easiest thing we can do is train the mind to focus on the things it can control rather than those it cannot.
To do this, we need to pay close attention to the process of trading; that’s to say the study of charts, indicators, entries, exits and risk management while taking the focus off the outcome of each trade.
Of course, doing this is easier said than done. Still, with practice, successful traders learn to see successful trades as those during which they executed their entries and exits precisely, without emotion.And they do this while sticking to their trading plans and risk management rules.
Fortunately for Anna, she recently found Total Alpha. A trading service that gives its members a thorough understanding of the trading process. And has a step-by-step approach to learning, at the very core of its philosophy.
And while Anna admits that she doesn’t yet feel secure enough to trade solo, she’s sure that she’s on the right path.
“With real-time mentoring from Jeff Bishop,” she says, “I’m gaining little by little – day by day. This makes me feel more confident and helps me generate more income.”
“With real-time mentoring from Jeff Bishop, I’m gaining little by little – day by day. This makes me feel more confident and helps me generate more income.”
Indeed, since signing up for Jeff’s service for an initial three months, Anna has reaped some remarkable rewards.
Sensibly, she was content in the first month to observe from the sidelines, placing no live trades until she felt comfortable with Jeff’s system, his method of teaching, and, most importantly, confident in her understanding of why he was recommending his suggested options trades.
During her second month, Anna recorded an impressive profit of $2,000. However, in the following month, things really took off with big wins on United States Natural Gas (UNG) $1,500, Van Eck Vectors Gold Miners (GDX), and Wynn Resorts Limited (WYNN).
Most notable of all, was a Goldman Sachs (GS) trade, which returned her a remarkable $1,300 in a single trading day.
“In total, I’ve made $10,200 for this month. Now I feel confident that one day I will be financially free.”
“In total, I’ve made $10,200 for this month, says Anna, “Now I feel confident that one day I will be financially free.”
Financial freedom, of course, means different things to different people, but that’s the beauty of trading. With a disciplined approach to risk, an appetite for learning, and the right mentorship, trading can deliver almost any level of income or wealth.
For now, Anna’s primary goal is to support her family and put her kids through college without financial stress. And the results she has achieved in just three short months indicate that Anna is clearly on the road to achieving her objective.
Do you have a Raging Bull success story to share?
Peter De Neve
Certified Public Accountant