Underestimated sources of stress in trading: non trading related stress

A minor problem in trading that has occurred may be felt by you as very painful and serious at a time when you are particularly sensitive to stress, when your mental condition is weakened. The cumulations of negative events affect your trading results, especially losses and mistakes. It is best not to trade then. Stabilize yourself.

Stress and its impact on trading

You become particularly sensitive to stress, and your psychological reaction as a trader is greater and more painful when non-trading stress occurs: you are ill, you or a relative have an accident, a family member or friend dies, you have personal problems (e.g. quarrels, divorce, tensions at home, especially permanent), you have serious problems at work (especially permanent), etc.

Non-trading stress affects trading in the same way as it affects many other situations. Because… why not?

Very important: Stress from different sources is cumulative.

Reactions to stress in trading

At times when you are under severe or permanent stress in a field other than trading, you will be more attentive because market failures will be more difficult to deal with and you will be more likely to be knocked off balance.

This increases the number of errors and lowers your intellectual capacity as a trader, so you may find it more difficult to analyze beforehand as well as to trade.

It is possible, but it will be more difficult and you should be more careful in such situations.

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Good points.
I also wonder what if a trader goes into coma or sadly dies with their positions open and their account at mercy of time.

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It’s part and parcel of life no way around it I’m afraid.
I try like when I drive not to let the previous negative thoughts distract from the task at hand

Haha, that’s very extreme scenario :slight_smile: But seriously, this is why TP and SL are essential!

I imagine one way is to always set stop loss or limits on each position and let a member of family inform the broker to settle the account in such event. I know brokers are really good people.

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That’s a dark thought lol. But I bet that’s already happened to a few people!

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The other problem is what is he/she going to tell God about having died while gambling and caught redhanded: :nauseated_face:

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