Are You Addicted to Trading?
Imagine sitting around in a group… “Hi, my name is… and I am addicted to options trading.” Unless you are a trader, you will never understand this addiction. Even worse, you may never see it as a problem.
Trading comes with a prospect of high income, financial freedom and an exciting, frenetic pace of highs and lows. Even if you lose money on the market, the happy hormones kick in and provide a rush similar to eating, drinking or gambling.
As a new trader, you may experience beginner’s luck, luring you to earn even more money. Most often, however, you start losing, then keep trading to make up the loss. In a classic downward spiral, you end up trying to dig yourself out of a hole, deepening the ditch. The temptation is just too great to stop.
The body produces dopamine, an opium-like substance that rewards the brain’s pleasure centers. Signs of addiction are taking bigger risks, obsessing over trades, always checking the news and losing interest in other aspects of your life. If you seek the adrenaline rush, experience urges and the compulsion to always be in a position or are stressed, feel anxiety or the fear or missing out, you have a problem. Do you lie in order to hide your activity? Do you look for new capital to top up your account or ignore the consequences of losers? Are you indebted to fuel your habit, convinced that the next infusion of funds will be the last? If so, it’s time to seek help.
I admit, I am addicted. Is it a problem? No, it’s not a problem. I have learned to control it. Take heed, this is what works for me:
- Monitor your money needs. Are you trading for real income or for sheer pleasure? If you have already achieved wealth, then scale back to cut your risk. Trading small still gives you the enjoyment of winning but is much less dangerous.
- Use a Trading Log/Plan and shut it down when you hit your target for the day. You are done.
- Take a break from trading every now and then. Decide to “stop trading for two weeks starting next Monday.” Do not even fire up your trading account. Prove to yourself that YOU are in control. It is ok to not be trading all the time.
- Return to doing other things, such as engaging with your friends and family socially. When you take a vacation, leave your laptop at home, or at least out of sight. Enjoy the moment. Make trading your slave, not your master.
- Take up a new hobby or get back to exercising to get your mind off trading. Winding down with a good novel at the end of the day is better than getting riled up with financial news.
- Block our liberal slots on your trading log/plan to plan for your down times. The market will always be there with plenty of opportunities when you come back.
- When you do return, start with paper trades until you get in synch with the market. The SPDR S&P 500 ETF Trust (SPY) has a unique personality and temperament. It is good to observe how it moves before you engage.
The one sure cure for addiction is to blow up your account, not something you ever want to do.
One more thing: join Jon and me in our morning Trading Room. We can help you stay in control before trading controls you. As much as I love trading, I still have to actively monitor and ensure that I stay out of the danger zone. Jon and I have gone through this, and we can identify the warning signs. Join us to protect yourself and your capital. Uncontrolled trading can be hazardous to your wealth.
Check out our other programs to facilitate your need to trade.
The DTS Signal is sent to your cell phone as a text message. Buy it immediately, establish your sell order and collect your rewards.
Our Pick of the Day provides for a particular option to be purchased at market open. Both the DTS Signal and Pick of the Day enjoy a roughly 90% success rate.
Check out our Inner Circle for our Morning Market Assessment, daily follow-up report and our Wednesday night Meetups.
Still undecided? Join us for our Intro to Trading/Week in Review, 8 p.m., ET, Sunday night. Register now.
Create great trades,
Hugh
