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From a letter I received:

...I'm so frustrated. I have far too many losses. Now I have an anxiety attack every time I trade... Can you help?

Losses and setbacks can be the rule rather than the exception when it comes to trading. Discovering reliable trading strategies is not so much the challenge as is learning what to do when things go badly. Learning a strategy is one thing. Learning how to manage your trades is quite another. If you don't know how to handle trade management, a promising strategy frequently produces a loss. Losses and other setbacks are definitely frustrating and anxiety-provoking.

The professional trader is not generally fazed by these setbacks. Winning traders welcome challenges rather than hide from them; it's part of the excitement of trading, and what makes trading a challenge. Your ability to tolerate frustration is essential. It is most important to have a specific and active plan for coping with setbacks - otherwise they can build up psychologically and produce chronic stress problems. Your mind and body have limited resources, and unless you cope with frustration and anxiety effectively, you'll eventually become exhausted. You'll lose your ability to focus and process information objectively. By taking a few specific preventive measures, you can build up your tolerance for frustration to the point that you can handle trading setbacks.

People with a low tolerance for frustration tend to believe that they should experience absolutely no setbacks. But setbacks are a natural part of trading as well as of life itself. When you are working to succeed at a challenging profession such as trading, you should expect setbacks.

When you face a setback while trading, you should view it as an opportunity to learn and develop your trading skills rather than as a discouraging event. Changing your point of view with regard to potentially frustrating events can change your ability to tolerate them. If you expect them and accept them as being a normal part of trading, you'll have less frustration. Rather than feeling paralyzed by setbacks, you'll creatively think of ways you can use the setbacks as a new starting point that can lead to a higher level of trading skills. View setbacks as ways for you to gain more experiences with the markets and to sharpen your trading skills.

It's difficult to cope with frustration if you are tired. By getting plenty of rest, and especially sleep, you have a better chance of coping with frustration. Sitting in front of a screen all day exhausts your ability to focus. Regular exercise and proper nutrition can help your body create a natural defense against frustration.

Once you are properly rested and fed, you can make a specific plan for coping with setbacks when they occur. In addition to accepting uncertainty and setbacks as part of your life, you should think about the long term. You shouldn't expect to develop your trading skills without investing in the time to gain experience. You'll be frustrated if you set unrealistic expectations and fail to meet them.

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Master Trader Joe Ross wants you to learn trading and he created products to do just that, teach you how to trade. Go to our website to find which ones best fit your trading style.  Let's learn the art of trading Joe Ross' way!



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Saturday, 22 June 2024

Derivative transactions, including futures, are complex and carry a high degree of risk. They are intended for sophisticated investors and are not suitable for everyone. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results, and all of which can adversely affect actual trading results. For more information, see the Risk Disclosure Statement for Futures and Options.