Day trading is often seen as an easy and convenient way to make money online. This opinion has been supported by many online traders who seek to attract people to their trading courses. However, the reality is that Trading is more complicated than that.
It is a tough industry that can often lead to stress, burnout, and even depression. In this article, we’ll look at some of the best ways to beat market exhaustion.
What is burnout?
Burnout is defined as “a condition passionateAnd physicalAnd My mind exhaustion It is caused by excessive and prolonged stress. In most cases, this happens when a person is very busy, has little time for other activities, and is not well fed.
For example, freelance writers who work 19 hours a day may experience burnout because they have limited time to rest. Similarly, a day trader who spends ten hours in day trading may experience this burnout.
People in all fields, including students, experience burnout in different situations.
Why burnout happens to traders
The idea that most people have about day traders is an illusion. They believe that traders simply wake up, turn on their computers, read the news, and then start trading.
However, the The truth is that trading is much more than that. In most cases, traders tend to face great challenges in their daily activities.
And at times, they are usually some of the most stressed individuals in the world. Let’s analyze some of the reasons why traders get burned out.
high pressure environment
Both independent and institutional day traders work very well high pressure environment Where performance is key.
For example, if you Work for a hedge fund or investment bank, then there is a high probability that you will be paid based on your performance. Companies will only support you as an employee if you perform.
Likewise, if you are one Independent retailerChances are that you will be under pressure to succeed. So, This pressure can drive you to work harder Exposing yourself to burnout.
It gets worse when there is a lot of market movement and when things are not going well.
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Market volatility and unpredictability
Trading is a different game from other professions. For example, as a doctor, you often deal with similar cases. However, in trading, Every day is different Because of the unpredictable nature of the financial market. Sometimes, the market can be very boring and sometimes it can be very volatile.
So, we can see this volatility in the market You can make some good profits Sometimes and some Huge losses in other periods.
This volatility can lead to great burnout, especially when you are not performing as expected. It can also lead to great mental exhaustion.
As a sole trader, Isolation can lead to major burnout Since you are responsible for doing all the research and trading.
Sometimes, feeling lonely under stress can lead to extreme mental exhaustion. The alternative, which involves being part of the trading floor, is seen as a better option.
When trading as a team, you will often interact with your colleagues. You will also find yourself deliberating on major issues. In most periods, talking and interacting with others can help you fight burnout.
lack of rest
Another thing that can cause burnout is lack of rest as a trader. this happens When you trade for extremely long hours Per day.
Some forex traders start trading in the Asian session and continue to do so during the American session. Sometimes, they also trade other financial assets such as stocks and indices in between. Doing all this can lead to huge losses and exhaustion.
Burnout can happen due to financial pressures Such as the need to earn money to deal with many activities.
For example, if you are collecting cash for school fees or construction, you may be under pressure to become very profitable.
Effects of Exhaustion in Trade
There are several important effects of exhaustion in trading. Some of these effects are:
- depression Burnout can often lead to stress and depression, especially when you do too much and achieve too little.
- Productivity erosion – In most cases, fatigue leads to lower productivity among traders. This happens when you trade for the sake of it. Also, over-trading can lead to huge losses in the market.
- increased risk – Exhaustion can increase the risk of risk. When you risk a lot, you can also lose a lot as well. This, in turn, can lead to more risk taking, which can lead to more losses.
- illness – Sometimes, it can lead to psychological illnesses, which can have significant impacts on the market.
How to beat burnout in trading
Take regular breaks
A simple way to beat burnout is Take regular breaks during your trading sessions. There are many ways to do this.
For example, you can execute trades, set stop loss and take profit, and then do other things. In this case, the result will always be a loss or profit based on the stop loss and take profit. You can also decide to take some afternoons off.
Related “ What do day traders do in their spare time?
Be on the trading floor
As mentioned earlier, one of the causes of burnout in trading is being a solo trader. This happens when you spend too much time trading alone.
You can deal with this challenge by being a member of the trading floor. Fortunately, using a platform like DTTW can help you start your own trading floor or join an existing one.
Focus on a few deals
Another way to fight burnout is Focus on executing a few trades each day. For example, you can focus on trading US stocks alone. In this case, you can execute a few trades instead when opening hundreds of trades per day.
If you are a regular watcher of our TraderTV live trading series, you will find that our professionals usually open only a few trades per day.
Seek professional help
finally, Seek help from specialists. A mental health professional will help you deal with emerging issues of your mental state.
For example, they will recommend drugs that reduce your anxiety and a diet that will improve your health.
There are other things that will help you avoid and overcome burnout. For example, having a mentor, Trading diariesOpening a few trades will help you deal with it.
You can also decide to automate your trades using algorithms or with copy trading that can help you.
Useful external sources
- What are some ways to prevent burnout as a day trader? – Quora