Panicked and Stunned

Tom is in a panic. He has been pushing himself all month to reach a specific financial objective, but he can't seem to make it. In a last ditch effort, he has made a big trade and he is ready to execute it, but he can't get it done. He is so anxious, agitated, and frustrated that he cannot do the most simple task. Tom is having a trader's panic attack. He is so fearful that he just cannot function.

Have you ever felt like Tom? When fear sets in, your body reacts with such agitation that nothing seems to go right. You start doing dumb things. Even the most commonplace task can't get done, or you make stupid mistakes, like closing the wrong trade or reading a chart incorrectly. You can be so agitated that you accidentally kick the power cord for your computer out of the wall socket. The human body is wired to panic at times. There are vast individual differences. Some people are calm no matter what, but others are easily unnerved. Nevertheless, when panic sets in, our attention is truncated and our options are limited: We either stand up and fight or run away to save ourselves. These are the two basic instinctual responses when panic sets in. Some traders react to panic and frustration by throwing their mouse out the window. That's how basic the human animal can be at times. But again, there are vast differences. There's no one right way to trade and many different viable trader personalities. The limitation isn't in having the "wrong" personality for trading. The limitation is in trying to be someone that you are not. If you are easily panicked, it is vital that you identify this potential drawback and work around it.

Look at your personality closely. Are you the kind of person who may have a trading panic attack? Do you get so agitated at times that you can't think straight? If you are prone to such a malady, you can work around it. First, limit your risk. The more you have at stake, the more agitated you are likely to become. If you risk little, though, you will know in the back of your mind that you can handle the worst case scenario. It will calm you down. Second, always remember that you can scale back your financial goals if necessary. If you can't reach your goals, don't worry about it. Do what you can do. You will find that your feelings of agitation are greatly reduced when you set more modest goals. Third, use a broker if you need to. Although we are in the midst of a technology boom, many professional traders still call their broker to place a trade. It may seem old fashioned, but some traders realize that actually placing trades puts them on edge. They know that they feel calmer when someone else actually puts their money on the line.

You don't have to be the ideal trader to profit in the markets. Indeed, the myth of the ideal trader is just a myth. There are many different kinds of people trading the markets profitably. The key to success is to be true to yourself. Gauge what your personality is, and work around it if necessary. Don't be afraid to be yourself and to take steps to change your trading methods to suit your personality. If you are prone to anxiety attacks while trading, scale back and calm down. You'll find that you can think more clearly and trade more profitably.