How to overcome the fear of trading

Saqib Iqbal Updated:

How to cope with the stress of trading

The financial market attracts many people with all of the opportunities it has to offer. For some it is the draw of something new, for others, it is a great opportunity to prove their intelligence. However, the end goal for anyone working with finances is profit! This, in particular, is true of any online trader without exception, the pull of the possibility of generating a sizable profit! That being said, few new traders understand the difficulties of trading on the financial market and the problems that arise when trading on the way to success. Today, we are considering the problem of the connection between mental and physical health that prevents the vast majority of potentially successful traders from generating significant and reliable profit, that being the stress of trading! To order to best do this, we will explain the reasons that this feeling arises and the ways to cope with it.


How to cope with the stress of trading


What initially draws us to the market?

So, if we were to do a poll on what initially drew the vast majority of beginners to the market, it would be clear that most of them were drawn in by the aggressive advertisement campaigns of various trading platforms. In these, they emphasize how easy it is to earn money on the financial market and what opportunities that this field can offer to investors. It couldn’t be easier, just follow the rates on the monitor with the help of specialized strategies that generate signals for placing contracts, then open the position at the right moment. This is exactly how many people become traders, right? These advertisements have little to say about the problems that you will face throughout this process! For example, the significant influence that emotions have on trading results, the difficulties of conducting technical analysis, forecasting the market, and so on. Many psychological issues arise. In general, industry experts consider the psychological aspects of trading in particular to be the most important drivers that influence how effectively you trade. We will go into this in detail.

The reasons that stress arises when trading

Any beginner choosing a trading system recommended by a trading”Guru” will read a thorough explanation of all aspects of how it works in the description. More often than not, you’ll see the phrase “keep your emotions under control” somewhere in the materials. When experts move away from the psychological aspects of working on the market they are making a grave mistake, as it is the most important aspect for any trader, because it is human consciousness and emotions that form a person’s pattern of behavior in specific situations in life. Whereby in this case stress, one of the most widespread psychological emotions, plays a very important role!

The main reason that this psychological state arises when trading on the financial market is the potential of losing physical wealth in the form of money! Imagine that you worked for ages to earn your starting capital, even the smallest amounts, and suddenly you lose it. You will experience a sense of regret and disappointment as a result. When this has all already happened before you place your first contract, you become stressed. The basic instinct of self-preservation against projected financial loss leads to an intense stress, which is a beast capable of causing physical pain. You can’t consider the issue of getting stressed without analyzing the emotions and overall psychology of trading.

Everyone operates based on their own emotional state when they make a specific decision. Here is a preliminary list of such psychological states:

● Joy

● Faith in the result

● Disappointment

● Sadness

● Depression

● Panic

These emotions define the path that people take in any given situation. Meaning that your thought process and natural instincts for making a specific decision are dependent on your current mood. Therefore psychological factors can change the current situation. For example, say not everything has gone to plan, leading to a shift in the person’s emotional state. They will then begin to feverishly search for other ways to resolve the problem. By the way, that is an accurate example of the situation that often arises for traders on the financial market.

Psychology and emotions are the root of nearly every international financial crises, ranging from the Great Depression to the “Dotcom” bubble to the mortgage crisis. People, in the quest for wealth and guided by their greed, blindly following trends and make seriously risky investments in popular assets. When the bubble bursts, they are driven by their negative emotions to find some kind of resolution to their problems and end up making even more mistakes, driving themselves into a corner.

The second reason that stress arises is due to human biology. Yes, imagine that stress has a fully comprehensible physical form. The human organism releases hormones and chemical compounds in stressful situations that cause you to feel stressed. This, of course, is completely natural, although the process of evolution didn’t account for this emotion becoming a barrier to achieving success on the financial market.

How should you relate emotionally to trading?

What sets people apart is our minds, how we analyze our own situation and actions, as well as making decisions consciously based on an evaluation of various factors. Believe me, no animal or other organisms could come close! Therefore, when you project the psychological factors onto the exchange, you could say that every user analyzes their own actions. The issue is that all active traders consider their previous experiences trading, especially negative ones, as technical mistakes. They are unable to see them as being caused by psychological factors. For example, when a contract ends in a loss, it is likely that many of you have often asked yourself the question, “what was I thinking when I placed this trade?” or “why did I do that?”. Technical mistakes in trading are always the result of you letting your current emotional state influence your decision making. Stress is at the forefront of this and is the most destructive emotion. It leads you to be impulsive when you make trading decisions.

Consider your emotions on a wider scale. We recommend you conduct an experiment by evaluating your mental state in the following situations:

● When you are on relaxing

● Right before you start trading

● When you are trading on the exchange

● After you have conducted your trading operations

● When you are trading on your demo account

You will notice a difference, and it will be significant. Without a doubt, you will analyze the market more effectively and generate more accurate forecasts on a disconnected terminal or a demo account than you will when you start trading with live funds. The reason for this is you fear that you will lose your capital or fail to achieve your set goals. Your emotions make the decisions for you, will you be a successful trader or lose your money.

When you understand how much stress can influence trading results, you won’t be able to ignore it. If you aim to become a true professional financial trader and your goal is to generate highly impressive trading results, then you need to manage your stress, as well as other negative emotions. There are several surprisingly easy techniques and approaches to do this.

How can you overcome the stress of trading?

Getting a bit ahead of ourselves, it is important to mention that it is impossible to completely prevent stress. As we mentioned earlier, it is natural and is our most powerful protective instinct. That being said, there are ways to avoid stress and enter a more local state, enabling you to make decisions more effectively.

To do this, do the following:

● Calm down. To do this, you need to admit when there is a problem! You should clearly tell yourself that, yes, I am scared to make mistakes, to lose money as a result of those mistakes, to leave a contract running overnight, to set stop losses, and place contracts. This is the basis for resolving your problems. Once you recognize the problem you will start to look for ways to resolve the situation, including emotional and psychological resources within yourself. As a result, you will be calmer and start reacting better to critical trading situations.

● Utilize your biophysical resources, in this case, weight and breathing exercises should be the first things you try. For example, we recommend taking deep breaths of various lengths, as this can help stabilize your blood pressure in stressful situations and normalize your heart rate. During panic attacks, experts recommend taking breaths in a contained space. For example, a paper bag against your lips decreases the symptoms of a panic attack and helps you return to a normal psychological state. In terms of physical exercises, a simple push-up on the floor works. Other than that, as a way of managing stress, it helps ease the pressure on your fulcrum and back as you sit at your monitor. It is recommended that you sit with both feet equally on the floor and sit up straight. As a result, you will find emotional balance relatively quickly.

● Chewing gum. Don’t be surprised, chewing gum is actually very effective in lowering stress. It is a fact that physiological distractions are a very beneficial way to decrease anxiety. Other than that, according to psychologists chewing gum gives you confidence and motivates you to make more thorough, pragmatic decisions. Proof can be seen in the fact that professional sportsmen use this as a method for controlling their emotions before important tournaments they always chew gum. Try it and you will see results very quickly.

● Log off. If you can’t get your emotions in line, just close the terminal and do other things. During which you can think through future market patterns and trading strategies. Remember that your emotional state is more effective when you break from trading. This is when you will make the most effective trading decisions

● Know yourself. As a way of decreasing the stress of trading, it is recommended that you try to look at it abstractly as if you were on the outside. Ask yourself more questions and answer them honestly and accurately. You can make up an imaginary assistant who constantly criticizes your decisions. Exchange being stressed for another, more comforting emotion that will allow you to more consciously evaluate how accurate your analysis is and assess market data when you are making trading decisions

● Identify your psychological strengths and weaknesses and always take advantage of them when you make decisions. Therefore, you can develop the habit of working when you are stressed without any particular psychological problems and you can build a more emotionally comfortable mentality for working on the market.

● Take control of your psychological state. Stress is an emotion that doesn’t arise out of nowhere. It arises for a myriad of reasons that we’ve already mentioned at the beginning of this article. Therefore, in order to avoid stress, you just need to avoid the factors that lead to it. For example, if you are afraid of losing money, just take a more comfortable level of financial risk. It isn’t worth risking funds if the idea of losing them leads you to stress and panic. You yourself define the parameters of your trading. Therefore, you should be trading under conditions that you are comfortable with, including on a psychological level, it is up to you

Analyze your mistakes. There is a saying that goes “without failure, there is no achievement”. Making mistakes is completely natural and happens in every sphere of life. It isn’t worth fearing mistakes. It is better to analyze them and correct them. As a result, you will not only gain experience but open up the possibility of effectively managing stress and other negative emotions.


So, we have gone through the reasons and consequences of stress arising during trading on the financial market, as well as give you several simple and effective approaches for managing your emotions to limit their effects on your trading. You, as a potentially successful trader, need to keep this simple truth in mind, your trading result depends on your psychological and emotional state at the time you make your trading decisions. By controlling the negative factors, you can achieve the best results.

“General Risk Warning: Binary options and cryptocurrency trading carry a high level of risk and can result in the loss of all your funds.”