Start with Relieving Stress

By: Jea Yu

The following is an excerpt from Jea Yu's Trading Full Circle

Remove Your Blotter

The majority of all stress related to trading comes when money is the main focus.  Telling yourself not to think about the money is easier said than done.  During the training phase, you must absolutely not be exposed to the money factor, even when you are trading 100 share minimum lots.  By removing this money component, you will relieve a significant amount of stress.

The action here is to physically remove visual access to your profit/loss balance.  Do it cold turkey.  The only thing you want to have open is the actual trade confirmations and open positions.  If the blotter is part of the open positions, then try to reshape the window to not display the profit/loss balance portion.  This simple action allows you to focus solely on the art of the trade.

In fact, if you look back at your prior blowouts, most of the time, the stress came from constantly watching your profit/loss balance blotter throughout the day.  This damaging measure of performance brings about tremendous unnecessary tension, especially during losses from the top and draw-downs.  Constantly watching a negative profit/loss balance throughout the day subconsciously creates the feeling of regression and falling behind.  By physically removing access to your blotter (and consciously preventing yourself from peeking), you can create a more viable stress-free environment.

Write It, Don’t Bite It: Keep a Journal

At the end of the day, you should keep your journal as if you were a psychiatrist with a patient, or a boxing coach with an athlete, and objectively analyze and document his progress.  A journal should be a third party analysis of the “client”. 

Unlike other types of trading journals, we are not keeping tracking of every single trade and the premises and results.  You already have a record of that in your trading software and blotter.  Through the years, I have realized there is no point in keeping records of every single trade in a journal.  It is redundant, time consuming, and serves no utility down the road.  Your blotter will show that anyway, which we don’t even want to really address during the day.

There’s been a lot of material written about the proper way of keeping a trade journal.  Keeping a journal can be a tedious task, but anyone who has ever kept a diary knows how memories tend to come back.  As much conjecture as there is about the capacity of the human brain and its ability to store infinite amounts of data in the form of experiences, those who have ever kept a diary understand one key reality – the brain can recall even the slightest details, as long as those details have been documented.  The mechanics of posting the data is not the important part.  A solid trade journal should be documented in the form of a diary.

Mindset

Stress can cause rational people, with rational intent, to do irrational things.  Stress causes fear, anxiety, paranoia, and desperation.  Stress triggers tension, which in turn causes more stress, resulting in a snowball effect.  Stress causes blowouts as the human mind subconsciously strives desperately to diminish that stress.  For traders, the only way to relieve the stress is to be forced out of the market, to cut off the source of that stress, which is trading.

Therefore, in order to maximize the foundation-building and learning process, one needs to absolutely eradicate any presence of stress in our trading “gym”.  Stress-free is the key component.  This “gym” should be your sanctuary free of stress and tension.

Letting Go

Make no mistake.  Making money can not be a concern in the beginning stages of your trading.  I can not stress this enough.  You must not be concerned with making money right now.  The money will come in time, but it absolutely can’t be a factor in any sense, shape, or form.  You have to let go of that stress.  Let go of the concerns about having to make money to pay the bills.

Only by truly letting go will you be able to gain.  Traders typically blow out their accounts and go through a period of clarity when things make sense.  They are in that stress-free zone, but not by conscious choice (this is a very important detail).  The problem is when they return to the trading game without properly building the foundation, they fall right back into the stress tension trap and blow out again.  This is why it is imperative during that downtime to properly build the foundation and go through the proper training.

Just like the conventional wisdom of going to law school or medical school, students are there to learn their craft and build a foundation with the understanding that success will lead to wealth down the road, after they have achieved the required credentials in due time.  Do you see medical students sweating the income factor every day as they go to classes?  In fact, they don’t expect to make any money in the beginning.  No exceptions.

Repeat this mantra: “I have no expectations to make money during my learning process which may last six months to a year.  It will eventually come.  I will only concern myself with learning the art of trading and conditioning myself to improve on a daily basis.”

In reality, there are two ways to make sure that you aren’t desperate for the money.  It’s pretty much that simple.  This means that you either have an income source or have enough money put away (for at least six months) to not worry about paying the bills.  If this is not the case, then step back and get a second job.  You must have the reserves to pay for at least six months of expenses in order to give yourself the proper opportunity.
 
Eventually, you will find that money is just a way of keeping track of your progress, a scoring system.  Often during the training period, there appears to be no quantifiable measure of one’s progress; therefore, it is essential to shift the paradigm and have measurable targets to assess your progress during this period.