How you can benefit from stress management as a trader

Boost your trading performance by learning to work under pressure

Mar 29, 2018 · 4 min read

Did you know that only as little as 1.6% of traders are profitable in an average year?

Why? Great performance is a combination of the knowledge of financial markets, experience, guts and education and not so many traders have the whole package.

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But it also has a lot to do with stress resilience. Stress impacts traders performance more than you think and leads to health complications and lesser profits. So as a trader you definitely need to learn more about your body as well as the stock market if you want to be successful.

Trading is stressful

It is no secret that trading is stressful. In fact, according to Business Insider it is the second most stressful job on Wall Street, right after investment banking.

And no wonder: if you are a trader, you need to make a lot of decisions and you need to make them fast. You’d also better be right as bad ones will cost you a lot. It sure is stressful and it sure is not easy: statistics shows that Traders even admit it themselves: 2 out 5 say they are dealing with extreme stress every day. In fact, the pressure is so high, that more than 75% of them quit within their first two years.

But it is not just traders’ health that it at stake here. We’ve done the research and found out that traders who are feel under pressure and cannot manage their stress are less successful.

Traders who can manage stress are more profitable.

If you are a trader, finding out that your job is stressful will probably not come as a surprise. But now you also know that it damages your work performance as well.

So what can be done about it before you have to deal with the consequences?

How stress affects trader performance

You might think that traders who make more money are less stressed. Well, actually, it is the other way around. You need to learn to manage stress to make more profits.

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This has to do with the hormones. Research shows that traders with high testosterone level are more likely to do well. But only until a certain point. When testosterone levels go up too high, cortisol, the primary stress hormone, kicks in. Cortisol is incredibly sensitive to “situations of uncontrollability, novelty, and uncertainty” which happen to be the main components of trading. High cortisol level results in anxiety and clouded judgment which causes traders to take irrational decisions.

When the stress gets too high you lose money

Another research also revealed that the most successful traders alsoacknowledged their anxiety and tried to manage it, rather than make emotional decisions, while traders who ignored it and kept going were less profitable.

Traders themselves agree. A survey among 291 traders revealed that stress resistance is one of the top-5 most important characteristic of a successful trader.

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So if the evidence is so overwhelming something is definitely being done about it? You’d think.

In reality, another survey showed that 70% of traders believe that admitting their problems to the management would only damage their career and consider just quitting their job instead.

If the management is not ready to cooperate, does not mean you cannot do anything. Do not quit yet, we might know how to help you.

What can Welltory do to help?

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Data matters in trading but it also matters when it comes to your body . At Welltory we measure heart rate variability to learn more about the state of your heart an nervous system, find out your stress and energy level and use our AI-based algorithm to provide you with personalised recommendations based on biofeedback.

With Welltory stress will not get in the way of our work performance

Stress affects your brain and slows down cognitive function making you unfit to make decisions. Welltory will tell you when the pressure is too high and it is time to take a break. That way you will always know when the stress is affecting your performance and what to do to always be at the top of your game.

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You will always be equipped with current data about the state of your brain and body to be able to make informed decisions. It will help you be happier, healthier, boost your work performance and lead to better trading and more profits.

Ready to take your performance to the next level?

Download Welltory to make your first measurement.

And keep in touch!

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Welltory is the #1 app that uses AI to combat stress and…

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