1) The brain is predisposed to avoid uncertainty and ambiguity, favoring certainty, which works against trading where managing uncertainty is key.
2) Emotions like fear and greed hijack traders' psychology when stressed, disrupting clear thinking needed for trading.
3) By learning to regulate breathing and muscle tension associated with emotions, traders can disrupt the arousal of emotions like fear and prevent them from taking over thinking. This allows for a calm, mindful mindset needed to manage uncertainty in trading.
Original Description:
Train the brain to manage trading fear and anxiety
1) The brain is predisposed to avoid uncertainty and ambiguity, favoring certainty, which works against trading where managing uncertainty is key.
2) Emotions like fear and greed hijack traders' psychology when stressed, disrupting clear thinking needed for trading.
3) By learning to regulate breathing and muscle tension associated with emotions, traders can disrupt the arousal of emotions like fear and prevent them from taking over thinking. This allows for a calm, mindful mindset needed to manage uncertainty in trading.
1) The brain is predisposed to avoid uncertainty and ambiguity, favoring certainty, which works against trading where managing uncertainty is key.
2) Emotions like fear and greed hijack traders' psychology when stressed, disrupting clear thinking needed for trading.
3) By learning to regulate breathing and muscle tension associated with emotions, traders can disrupt the arousal of emotions like fear and prevent them from taking over thinking. This allows for a calm, mindful mindset needed to manage uncertainty in trading.
by uncertainty. Understanding the inter-relationship between the biology and psychology of fear helps traders grow. The brain’s bias to avoid the discomfort of uncertainty conspires With a relaxed mind, against the trader’s need to develop the mindset you can become mindful that can manage uncer- of your beliefs about tainty and probability. the management of BIOLOGY MEETS uncertainty. TRADER PSYCHOLOGY The brain (and the mind over the cognition of the need for clear, impartial that emerges out of it) mind, and the trader per- thinking. was never intended ceives and acts from fear. Recognizing the fact for trading. It was en- Uncertainty in trading that emotion is biological gineered to avoid the cannot be avoided. The and that it takes over the confusion generated by brain and evolution have quality of the thinking of uncertainty and ambigu- shaped our beliefs so that the trader’s mind allows ity. Our brain developed a trader brings a fear- us to understand emotion a predisposition toward based psychology rooted very differently. Emo- creating certainty rather in predicting certainty tion, from this perspec- than the management of and avoiding uncertainty tive, is any disruption to a uncertainty. to an endeavor where standard familiar pattern It is these emotionally the management of the that the brain has es- based beliefs embed- risk of uncertainty is the tablished already. If you ded in the brain that the needed skill. The brain have ever felt anxious trader brings to trading. and the untrained mind when trying to commit to Emotion is biological, not that the trader brings to an entry point or gotten psychological. Emotion trading is going to have to rattled when in a trade, takes over the trader’s be retrained to produce you have experienced psychology. Emotionally the mindset needed for emotion triggering after a undisciplined traders are successful trading. disruption to a standard predisposed to have their sensorial pattern based minds taken over by fear. EMOTION AND MIND on a belief in the need for Emotion, while under The first step in develop- certainty. stress, hijacks traders’ ing a trading mindset is Fear gears the body psychology, and they are to understand emotions and mind up for fight or consumed by reactive and how to work with flight. If not regulated, fear. Suddenly fear-based them so that fear (or its the arousal of the emo- beliefs about the manage- cousin, greed) no longer tion hits a threshold. The ment of uncertainty take contaminates the trader’s chemistry of fear takes over the body, and then RETOOLING FOR TRADING disrupted. Consequently the feeling element of Because emotions are fear is managed and the emotion takes charge biological, a trader can does not hijack the criti- of the mind. Feeling is learn to regulate emo- cal thinking necessary the subjective experience tion. Each emotion has for trading with a clear, of an emotion. Think a breathing and muscle- relaxed head. about how you feel when tension-signature that is trying to pull the trig- associated with it. FROM BRAIN TO MIND Emotional state manage- ment provides the skills to Emotional state produce a calm mind. Until this is done, you do not get management provides to the door of the mind. the skills to produce With a relaxed mind, a calm mind. you can become mindful of your beliefs about the management of uncer- ger and finding that your If you alter the kind of tainty. You can now devel- finger is frozen. Feeling breathing and muscle op a mind built to manage then produces a certainty tension that is associated the risk of uncertainty in the belief in whatever with the emotion, you from a state of calm. Fear direction the emotion is also disrupt the arousal transformed into concern taking you. of that emotion and the and a mindset rooted in If the direction is to- capacity of the emotion to disciplined impartial- ward fear, you will be- be maintained. ity can be brought to the lieve in the certainty Fear’s biology requires management of trading that bad things are go- shallow, fast breathing uncertainty. ing to happen if you pull (or holding of breath) the trigger. On the other and tension in areas of hand, if the emotion is the body such as the Rande Howell (MEd, LPC) is a euphoric (greed), it will jaw, eyes, neck or shoul- licensed therapist and perfor- hijack your mind into ders. By altering the mance coach. He is the author believing with certainty breathing and tension of four books including “Mindful that the good times are elements of the emotion Trading: Mastering Your Emotions going to continue to roll. using diaphragmatic and the Inner Game of Trading.” Gone is the disciplined breathing and relaxing impartiality you need to the muscles, the emo- trade effectively. tional force of fear is