Overcoming trading fears is hard for any trader, new or old. However, this week I read an article on “8 Military-Tested Tricks to Conquer Your Greatest Fears” by Joe Oliveto (http://bit.ly/conqueringfears). I was amazed at how the military uses the same techniques that traders use to conquer their fears.
Overcoming Trading Fears Using Military Tested Techniques
- Spend tons of time preparing and practicing. While some traders believe that trading is easy, it isn’t. Overcoming trading fears takes a lot of practice, documenting what you did right or wrong, what worked versus what didn’t work. However, before you can even move into this stage, you have to prepare — that means studying and lots of it. Here is an example. When my son went to boot camp for the Army, he had never held a weapon. When the Army issued his, he had to sleep with it, eat with it, and know where it was at all time. He had to take it apart, put it back together over and over again. He had to study and know all the different guns that he would use, why, how they worked, and how to use them safely. He actually understood when I said “I dreamed of price bars” because he dreamed about his weapon. Although he initially thought it was super cool to have a weapon, the Army taught him how dangerous the weapon could be and he gained a sense of respect and caution when handling it. Then he spent a week, hour after hour, day after day, shooting and cleaning his weapon to become efficient — not an expert, but simply efficient. In the years to come, he will more than likely become an expert, but he is the first to admit, he has a lot to learn.
- Using laughter to overcome trading fears. Studies at Stanford University shows that laughter relieves anxiety and fear by fooling the body into thinking everything is going to be alright. Although the brain is a negative assessment machine, we can fool it by sharing a laugh, as traders, because none of us get to the point of profitability without some hilarious stories.
- Deep Breathing — sounds simple but yes deep breathing can help you in overcoming trading fears. Physical manifestations, which include shaking like a leaf, heart pounding out of your chest, etc, can be signs of fear and anxiety. Next time, remember the same exercise that Navy Seals use — FOUR. Deep breath in for four seconds, deep breath out for four seconds. Continue doing this until you heart slows and the shaking subsides. As one SEAL instructor said, “You’re bending the body’s software to control the hardware.” Plus, while sitting at computers, we tend to do shallowing breathing, which can actually intensify the physical manifestations of fear. Another recommendation for individuals sitting at computers is to remember to perform these deep breathing exercises every time they answer a phone.
- Don’t keep it bottled up. Keeping all these emotions from trading bottled up, only serves to intensify your trading fears. While trading is isolated, you can use writing (that’s what I use) to release the trading emotions and garbage so you can face tomorrow anew. Simple, yet quite effective in overcoming trading fears from the previous day.
- Talk over the voice in your head. Anyone that is in my binary signals room know, I talk to myself. My mom always said it was okay as long as the walls do not answer back. Talking allows me to calm the negative assessment voice that otherwise would simply be out of control. By talking myself through trades, or even encouraging the price bars to move in my direction (I named the price bars Bessy), I don’t hear the inner voice telling me I’m in danger.
- Always plan for the worse case scenario. This is why I LOVE Nadex. It presents the worse case scenario before entry because you pay the risk upfront. While the futures market can move against you a lot more than anticipated, even with a stop in, Nadex Binary Options and Spread can’t. It is a more logical approach to trading because you analyze the worst case scenario upfront. If you are not comfortable with the risk or the reward then you simply bypass the trade opportunity.
- Meditation helps in overcoming trading fears. Studies of the most successful people in business, entertainment, and trading have revealed that almost all of them use meditation on a daily basis. Meditation which can be performed anywhere is simple an exercise that trains your brain to focus on where you want it to be and allows you to practice your deep breathing exercises.
- Keep pushing your comfort zone. Most new traders wonder why I venture into other types of trading mechanisms or markets. Simply put, I like overcoming trading fears of all types. In other words, I will not allow fear to control me. I acknowledge the fear (think the first couple of weeks of the Binary Signals room), and then push through it (ie fell on my face but got back up to become profitable). How? Because I had already worked out the numbers, and contrary to what most new traders believe, I don’t need a 90% accuracy rate to be profitable. In fact, at just 44% accuracy (up almost 10% in a week), I am profitable. In fact, for those that invested $99 for the Binary Signals Room because they wanted to learn to trade, we are up 195% on the initial $99 investment.
Overcoming your trading fears is possible by taking simple steps and being dedicated to your goals.