Updated from its original posting on 2011-07-01
When you’re trading, it’s so easy to get lost in the price action frenzy and neglect your physical well-being at some point. But if you’re giving up eating or sleeping in exchange for a bunch of hours trying to catch pips, you could end up destroying your most important trading tool: your body.
Have you ever tried trading without enough sleep or with an empty stomach? If yes, then you probably know how tough it is to concentrate and make sound trading decisions when you feel physically run down. You see, trading requires concentration, and concentration requires effort. If you don’t put enough effort in ensuring your physical well-being, your trading could also suffer.
Without a sound mind and body, it’s extremely difficult to stay focused. When you can’t focus, you increase your exposure to trading mistakes, such as forgetting to follow your trading plan or failing to do your research before taking a trade.
Attempting to overcompensate for this worn-out physical state can be damaging as well. For instance, trying to stay alert by downing several cups of coffee can put you in such a hyperactive state that you wind up over-trading. Either way, if your body is screwed, your trading gets screwed.
Just like any sport, trading requires us to be in our tip-top shape. Athletes maintain healthy lifestyles and make it a point to be well-rested before their games and so should you.
Of course, being in our top shape doesn’t necessarily mean spending hours in the gym trying to get abs like Ryan Reynolds’. Getting fit could be as simple as taking care of your body. When you get enough sleep, eat the right food type (no, that doesn’t include sugar-free donuts), and do just enough exercise to maintain a good blood circulation, you’ll increase your chances of making good decisions with your trades.
As important as the body is though, it’s our mind that does most of the work in trading. But I’ll share a secret with you: Some of the most effective tricks in getting our minds in good shape are also the simplest: getting enough sleep, not drinking too much alcohol, not taking any illegal substances, and not working too hard.
Another very important but often neglected practice is to take breaks whenever needed. Whether it’s walking away from your screen for five minutes or taking your family to a weekend vacation, it’s essential for you to be free of your personal worries while you’re trading.
Remember that a trading career is a marathon and not a sprint. This means that we have to pace ourselves if we ever want to become consistently profitable traders. Some might not get there anytime soon, but taking care of the body, our most important trading tool, is certainly a step in the right direction.