How to Remain Calm and Carefree with your Investing and Trading 

It’s all about perception.

What I see as being work, might be a fun challenge for someone else. The difference is, when we view a task as work, it can become boring, repetitive and stressful.

Why does the very same task, viewed from different perspectives take on a different meaning?

There are Higher Stakes with ‘Work’

Well, one possibility is that when something is work, we have more of a stake in it.

For example, playfully competing with your friend to see which one of you can guess how much people will spend during the upcoming holiday season is very different from being required to make a decision about which stocks are going to increase in value when the amount of sales increase.

The first scenario is a fun challenge, the other feels like there is a lot riding on being correct.

We Wrap Our Self-Worth Around Our Performance

Of course, there are those of us that love a good challenge.

We may get excited at the prospect of competing to be the best. Some of us though, take it very personally and feel that our self-worth is wrapped up in how we perform. No matter how we view it, our ego is at stake whenever we make a trade.

When we put our ego on the line, we begin to experience stress, the fun of trading no longer exists and the only thing that is being challenged is our self-esteem.

We can become so focused on outcomes, that we start believing that our worth as a person is diminished if we experience a loss and conversely, if we win, we are invincible champions.

If this is how we choose to approach trading, our self-esteem can feel like it is on a see-saw. Up and down, up and down it goes.

Sometimes, when we experience the thrill of winning, we want more of it and this could lead to impulsive trading. Eventually, we will continue to seek out the euphoric feeling and trading will resemble gambling more than it will disciplined and calculated decision making.

The Best Investors/Traders Maintain their Calm and Operate in a Relaxed Manner

Now, I understand that it can be hard to see investing/trading as leisure, but there are ways of making it more enjoyable.

For example, we can minimise our risks which will increase our confidence in handling the worst-case scenario. Trading is much more carefree when there isn’t so much at stake, and one way to facilitate that is to ensure you select only the most financially healthy stocks.

Also, realise that a trade is not representative of you as a person.

We all win and we all lose at some point.

When we are relaxed, we don’t run the risk of falling apart under pressure and therefore, we can focus on being more profitable. Take it easy, look for the enjoyment of trading and the rest will follow.

Another method to stay calm and relaxed with your investing and trading is to ensure you stay physically fit and healthy. It may sound a little far-fetched at first, but there are tremendous mental health benefits to things such as regular exercise and meditation, which top investors and traders employ to stay mentally sharp.

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Disclaimer

Effective Trading Solutions Pty Ltd t/as theFreedomTrader.com is a Corporate Authorised Representative (CAR No. 1267698) and Terry Tran is an Authorised Representative (AR No. 1267697) of Australian Financial Advisory Group Pty Ltd (AFSL No. 475300).

Any information or advice contained on or disseminated through this website is general only in nature and does not constitute personal or investment advice.

You should seek independent financial advice prior to acquiring or disposing of any financial product. All securities, financial products or instruments carry risks. Past performance is not indicative of future results.

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