The Mindful Trader. Becoming One with Alpha

Trading is a mysterious process.

There’s no end to it. There’s no certainty. Good trades can go bad. And bad trades can go good.

While most people would say that spirituality is the exact opposite of trading, there’s a zen to trading, just like there are spiritual paths to every endeavor.

Mindfulness training can be helpful to a trader for a few reasons.

First, mindfulness lowers stress. Stress for a trader is practically a given because of the shifts in fortune and uncertainty. By becoming aware of one’s thoughts, you recognize the repetitive, stressful thoughts and minimize the stress it causes you.

Another reason that mindfulness suits trading psychology is that you distance yourself from the emotions that cloud your decisions. Emotions, which can form negative trading patterns, are probably the worse enemies a trader has. There are two biggies: greed and fear. But other emotions can interfere with your intuition, or, if you will, your instincts. Insecurity, anger, envy, and dozens of other emotions bubble up in any given trade. By becoming aware of these emotional clouds, you’ve taken one step closer to mastering them, or, at least minimizing their effect on your trades.

There are those who suggest that you can retain more cognitive powers by eliminating the “junk” thoughts that bubble up in your head. Still others suggest more esoteric powers arise from mindfulness.

So, what is mindfulness?

Mindfulness training doesn’t require any special meditation practices. Numerous practitioners use techniques from a range of meditation practices. One of the most useful is to sit down in a quiet area and watch your thoughts.

When you notice a thought, just identify it as a thought and let it go. Your tendency–and you’ll notice it right away–is that when you have a thought, an emotion quickly chases it. Resist it. You’re just watching your thoughts.

Another technique: become aware of your breathing. Watch the inhalation and exhalations silently. When thoughts start to swirl, just watch them silently.

Eventually, you enter a zone of mindfulness. Over time, the training will extend to your trading practice.

How often should you practice your mindfulness training? Again, there’s no magic number and it seems that each practitioner has a different feeling about this. Most say that you’ll need to sit down and meditate at least once a day for a 20-minute session.

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