the-daily-trading-coach-101-lessons-for-becoming-your-own-trading-psychologist-brett-steenbarger-_2009_-a23

Stress and Distress 37work harder, learn more, and grow your trading account over time. Thatdoesn’t mean repealing stress; it means creating active firewalls betweenstress and distress. Risk management is one of the best psychological firewallsof all.COACHINGCUEPlan for every possible glitch in your trading: if your broker can’t be reached;if you lose your online connection; if your equipment fails; if your data vendorgoes down. My own trading station is small, but there is redundancy in eachof these areas. I have multiple brokers, multiple online connections, multiplecomputers, and multiple data streams. There’s always a rehearsed Plan B ifsomething fails when I have a position on. The glitches still cause stress, butnot distress.LESSON 12: ANTIDOTES FOR TOXICTRADING ASSUMPTIONSWhat we expect from life shapes our emotional experience. If we expectgood things, we tend to be optimistic and energetic. If we expect negativeoutcomes, we tend to feel anxiety. If we expect that success will eludeus, we’ll feel discouraged and depressed. If we expect perfection, we’ll becontinually disappointed with reality.To no small degree, our emotions are barometers of the degree towhich we are meeting or falling short of our expectations. That is animportant principle, because psychological research suggests that, if ourexpectations are biased, we’re likely to experience skewed emotions.The relationship between emotion and expectation is particularlyimportant for the developing trader. If you are your own trading coach,one of your overriding priorities is to foster the kind of positive experiencethat will sustain your motivation and learning efforts. Discouraged,defeated, and fearful learners are not effective learners. If you are goingto maintain that zone of focus and concentration that maximizes learningefforts, you have to be absorbed in markets. No one can be absorbed ifthey’re also battling emotional distress.In the spirit of Ayn Rand, who encouraged people to “check theirpremises” when they arrived at contradictory conclusions (“I should behappy” but “I shouldn’t be selfish”), I’ll now ask you to check yourexpectations—particularly if you’re finding that distress is interfering with