The profession of trader is unlike any other in society. The hours are unconventional, pay varies greatly, and performance is always under the microscope. Being a trader is 180 degrees from conventional sales or manufacturing work. It’s a discipline rooted in self-reliance, independence, and determination.
When a person chooses to pursue a career as an active trader, many regular aspects of employed life are passed over. Company-provided health insurance, a vested 401K, and even a 40-hour work week are foregone in the hopes of building a truly autonomous lifestyle. Make no mistake, being a trader is not for the faint of heart. But for those who want to choose freedom over security, the markets are an ideal destination.
A Day in the Life
A wide variety of factors play into how each trader’s day-to-day routine is structured. Trading style, markets/products targeted, and personal preferences all determine a given day’s schedule.
However, for almost all traders, an average trading day consists of the following tasks:
- Market prep: Preparedness is the key to success. Performing due diligence for the coming session is an integral part of being ready for any scenario. Traders typically conduct market preparation outside of live trading hours.
- Live trade: Strategy execution in the live market is a big part of the job description. However, actual trading hours vary according to the market and assets being traded.
- Evaluation: A post-session evaluation period is necessary to regularly quantify performance and put past triumphs/failures into a useful perspective.
These tasks are best completed in sequence, as elements of the three periods of the trading day. Of course, the work does not end there. It’s important to realize that as a trader you’re effectively running a business. You must allocate extra time for administrative duties, such as account maintenance, bill paying, and tax filing. Add in the functions everyday life, such as meal preparation or family time, and an active trader’s schedule can fill up very quickly!
The Emotional Impact
Much has been written addressing the negative impacts of the human element on trading performance. Bad habits — including overtrading, chasing losses, and the reckless use of leverage — are common problems attributed to the influence of emotion. In order to remedy these issues, traders implement automation or managed portfolios to effectively remove the human element from the trading process.
However, what is the emotional impact of being a trader on the individual? Active traders frequently cite feelings of isolation, stress, joy, and satisfaction as common parts of life:
- Isolation: While independence is a primary goal of most traders, the markets are often a lonely place to be. The modern marketplace is digital in nature, with participants working remotely without the presence of a staff or co-workers.
- Stress: Frequently risking capital stimulates positive and negative feelings associated with varying degrees of performance. In the event that swings in account value become too great, the stress associated with financial well-being can become intense.
- Joy: A majority of individuals attracted to active trading have an intellectual curiosity and thoroughly enjoy the process of “figuring out the markets.”
- Satisfaction: After periods of success, or even a weathered storm, it’s not uncommon for traders to feel a deep self-gratification.
Achieving a manageable and positive mental state is a big part of being a successful trader over the long haul. If allowed to continue unchecked, high levels of stress and extended periods of isolation can have exceedingly negative effects on the human psyche. No matter how much a trader enjoys the process of active trading or the degree of personal satisfaction, it can be difficult to maintain mental health.
In order to foster a state of clarity and fulfillment, it’s important to aggressively establish a workable work/life balance. The contemporary marketplace is a digital venue, offering trade on a near 24/5 basis. Seeking out opportunity in such a dynamic atmosphere can become all-consuming. It’s critical to take breaks from the market, spend time with family, stay physically fit, and pursue other interests.
Is Being a Trader Right for You?
Every year, tens of thousands of people join the ranks of active stock, Forex, and futures traders. But many have little idea of what the lifestyle actually entails. Often, naivety to the reality of the markets dooms aspiring traders before they ever place a trade.
A great way to find out exactly what being a trader is all about is by talking to an actual trader. For more information on whether a career in the markets is suitable for your current situation, contact the team at Daniels Trading for a no-obligation consultation.