March 8

6 Habits Of Calm (And Profitable) Traders

By Yvan

6 Habits Of Calm (And Profitable) Traders

I’ve been trading for a living since the end of 2006, and over time, I have come to realize that stress is part and parcel of the endeavor. It doesn’t matter how long you’ve been trading; how much of an expert you are, at times trading will be strenuous — it’s in the job description.

Most traders just don’t feel a sense of serenity/ calmness/ peace throughout their day. In fact, for many, the stress they accumulate as a result of trading for a living begins to pour into their lives outside of the market.

I’ve been there too, but I have learned a few things that have helped me create and maintain a feeling of calmness and spaciousness no matter what.

It’s a series of habits that I have developed over the years. They are super helpful, and I make sure that I practice them every… single… day.

One thing to remember is that you can’t control the things that happen in the market, and you certainly can’t control how that shapes up the outcomes of your trades. The only thing you can control is your response. And that’s what this post is about.

You can let an undesirable outcome stress you, or you can respond with peace, acceptance, and calmness. I suggest the latter, no matter what the outcome is, whether it is born out of a mistake or the normal distribution of wins and losses of your system. And the following six habits will help you with just that.

1.     Set up a calm morning ritual.

The moment some people open their eyes in the morning, they already start thinking and worrying and stressing. They get pulled out of bed by this constant chatter in their mind and start their day out in a stressful rush.

Personally, I’m an early bird. I usually go to bed early at night so that I can wake up early (around 5 a.m. these days, though that changes quite a bit when I’m traveling). Right after waking up, I start my day with a 20-30 min meditation, then a few yoga poses. I then brush my teeth; maybe a little shower. After that, before I head to my workstation and let the noise in, I put on some soft classical music, brew myself some nice dark coffee. (no sugar, no milk.)

You don’t need to do the same exact things, but make sure you make space for some calmness in the morning and make the most of it.

2.     Learn to watch your reaction.

When something undesirable and stressful happens in trading, what is your reaction? Some people are too blinded to see past short-term pain, and they jump into mindless reactions –primal or conditioned. They get angry or overwhelmed. They feel sorry for themselves and wish things were different.

But why can’t we behave better in times of stress? If you develop the habit of watching your responses, you’ll know why, and you’ll get to see that you always have the choice to respond skillfully.

Many times our automatic reaction is to take things personally. If the market does something we don’t like, often we tend to interpret this (unconsciously) as a personal affront.

Some people even think that God, the universe, life (call it whatever you want) is against them. But the truth is, it’s not personal. You can learn not to interpret events as a personal affront, and instead see them as some impersonal external event shaped up by a long chain of other impersonal events. And you can learn to respond to external things with calm and wisdom without letting them overwhelm you. Yes, it’s a skill, and you’ll get to develop it with a consistent meditation practice.

3.     Be grateful.

Sure, many people talk about gratitude these days, and for good reason… but how often do we apply it? When the market is crashing, your entire portfolio is blinking red, or you’re forced to take a larger than anticipated loss as a result of a significant gap down, it’s tough to be grateful. But it is possible, and especially urgent under such conditions.

One of my favorite philosophers, Friedrich Nietzsche, once said:

My formula for greatness in a human being is Amor fati: that one wants nothing to be different, not forward, not backward, not in all eternity. Not merely bear what is necessary, still less conceal it… but love it.

The concept of Amor fati (the love of your own fate), is compelling. In my practice of meditation (and mindfulness in general), I had already experienced that feeling countless times, but it’s the reading of Nietzsche that crystalized it in my mind, intellectually. It gave me the words to express that feeling and I just fell in love with the concept because the power that you can have in your life if you just accept it as it is, with all its ups and downs, not looking backward, only forward with a smile, is almost hard to fathom.

The power of Amor fati is that it doesn’t waste time, as Nietzsche made very clear. You’re only looking at what’s happening with enough strength to say, “I can do this. Nothing is placed before me that I can’t handle. I have what it takes.” You spend no time on blame, bitterness, or feeling sorry for yourself, and you put everything towards gratitude.

And what comes from that is fuel and action.

4.     Create stress-relieving habits.

Many times, when people are faced with stress, they tend to have unhealthy responses — some go to time-wasting sites, attack others on Twitter, compare themselves to an impossible ideal, while others eat junk food, drink alcohol, procrastinate, so on. Instead, we need healthy ways to cope with stress and the vicissitudes in our lives (which will inevitably come at some point).

When you notice stress, watch how you respond to it, and then replace any unhealthy coping habits with healthier ones.

For instance:

  • If you tend to go on time-wasting sites, instead go to the gym, or do some yoga.
  • If you attack others on Twitter, instead meditate.
  • If you drink alcohol, have some tea instead.
  • If tend to procrastinate, instead write about what’s afflicting you.
  • If you compare yourself to others,… just don’t.

This might seem caricatured, but it truly works if a genuine intention is there. Also, if you’re overwhelmed by stress, don’t neglect the power of a pause.

5.     Don’t multitask.

People now multitask more than ever. In my opinion, this is a great way to generate a level of anxiety that runs through everything you do, including trading, because it makes you impatient, restless and always worried that you should be doing more or doing something.

What if, instead, you just did one thing? When you’re trading, you just focus on trading. When reading, you just focus on reading. When watching videos, you just focus on watching videos…

What if you did only one thing and learned to trust that you shouldn’t be doing anything else?

Seriously. Ask yourself that question!

If you’re honest with yourself, you’ll probably see that there is peace in just doing just one thing. It reduces stress, and it makes things much easier.

6.     Reduce the noise.

When we trade, there are all kinds of noises — news, notifications, peoples’ opinion, your own internal noise. But, none of those are necessary. If you can cut out the noises (or at least reduce them to the bare minimum), you’ll create some space and some peace, and you’ll be better able to listen to intuition and wisdom.


That’s it. 6 habits of calm and profitable traders. I hope you implement them.

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