“Don’t sweat the small stuff – and it’s all small stuff” – W. Dyer

Whenever we’re dealing with bad news, a difficult trade, or a disappointment of some kind, most of us have behavioural patterns that are dysfunctional to say the least: we overreact and frequently “hold on too tightly”, attributing more importance than necessary to the event.

When we are immobilized by these “little things” we lose sight of the bigger picture, focus on the negative, and annoy other people who might otherwise help us. In short, we live our lives as if they were one great big emergency! At a certain point, everything seems  like such a big deal and we end up living in a bubble of darkness, with a cloudy mind and a weary spirit.

You can’t trade at all, if this is what happens to you when the markets misbehave and stop you out or force your account into a drawdown. In this article, we’ll learn to act like business owners that rise above the day-to-day disturbances and understand that nearly everything is “small stuff”.

How to Compound Problems

Let’s face it: most people (including myself) are easily absorbed and derailed by the day-to-day stresses of our jobs. Whether it’s a series of bad trades, tech issues, millions of emails to answer, strict deadlines to respect, traffic, (insert your preferred stressor here), etc.

The list could go on forever. But if our days start looking like a never-ending lineup of issues to tackle, we will be quickly buried alive. We will begin to believe that everything is a big deal and fail to recognize that the way we relate to our problems has a lot to do with how quickly and efficiently we solve them.

So here’s an example of the negative thought process in action:

  • It’s a nice day today – too bad I have to stick in an office for 10 hours.
  • Ah it’s Monday…weekends are never long enough and the traffic is really insane.
  • Ah look – XYZ has already arrived before me today, making it look like I’m slacking off.
  • What? 350 emails? What happened?
  • So we had ABC issue, ah what a great start to the week. I need to deal with this right away…
  • But what about all these emails? There are some from the boss…let me take a look…
  • Oh I forgot about the morning meeting…so much to do, in so little time…
  • etc. etc.

Which, converted to trading, would look something like this:

  • It’s the first week of the month – should be exciting with all sorts of events out
  • I’m still sitting in a losing position from the other day, perhaps I’ll just open two more trades this week and get back the losses.
  • Mmm..things aren’t going well..but why? Sentiment is on my side and it just doesn’t make sense.
  • Another stop out…things just seem so fragile..I make some and then give it all back…
  • Let’s hope the next trade goes well…
  • Ah another stop out…geez…
  • Oh I forgot to pick up the kids at school! I’m late!
  • etc etc.

Reframe Everything

Now that we’ve seen what NOT to do, let’s find out what works. Imagine the best manager you’ve ever had or seen or met. I’ve met two people like this in my life. One was the CEO of CIBC World Markets at one point in time. The other was the Owner of a boutique FX broker. Independently from the business you run (even if it’s your trading business or your family), it’s still incredibly easy to inflate all the little things that pop up each day.

One person can’t possibly take on the responsibility of a whole business, if they let every little thing bother them or if they consider every little thing important and worthy of notice.

Usually efficient managers are poised, calm, have a very powerful sense of priority and dismiss or delegate anything and everything that is “ordinary administration”.  More importantly, they “go with the flow” and don’t try to force anything. The need for perfection and “flowing with events” conflict with each other. Whenever we are attached to having something a certain way, we are almost always engaged in a losing battle. I have yet to meet a perfectionist that is living a happy life.

  • Remove the desire for perfection.
  • Remove the desire for control.
  • Prioritize and reframe everything that is thrown your way.

I think this is why business owners have an easier transition into trading. They have already learned that with responsibility come problems of many kinds. And as the business grows, problems don’t go away…they just change as the business owner “graduates” to another level of problems. But if you’re keeping tabs on all problems, whether big or small, and want them all solved immediately and perfectly, would you really be able to run a business at all? If everything seems super-important, would you really be able to think strategically and maintain a long-term orientation?

This is what easily happens to people that work a 9-5 job and want to trade. In a normal job, responsibility and accountability are somewhat limited. Important decisions are usually not the responsibility of one person alone. Once you leave the office, you are effectively free until 9AM the next day. As a trader, just like a business owner, that’s not so. Your results depend on you alone and this is not an easy transition for many people. You really cannot let every single trade stress you out, or look too deeply into each loss. You must believe in your strategy and have a long-term orientation. If you can dismiss single losses as simple “day to day issues” that any other business has, you’ll be in a much better position going forward.

Over to You

When you learn the habit of responding to issues with more ease, problems that seemed “insurmountable” will begin to seem more manageable. After all, if it’s not a life or death situation, what are you stressed about?  This article may resonate with some people, whilst others may think it’s a waste of time. As an author I cannot control that. And criticism will not bother me one bit because I know that this is just one article out of the hundreds that I’ve written already and out of the thousands I will write in the future.

All I can do as an author is attempt to convey important lessons that I have learned by getting into a situation and by finding a way out of it. And that’s exactly the point, in life as in trading: if you get into a drawdown, don’t fuss about the drawdown. It’s just a normal occurrance that all market participants have. It’s part of the job. Don’t let it ruin your days. Don’t let it ruin your sleep. Today might not be your day, and this week might not be your week, but if you can keep a steady course and let go of the small stuff, you will survive in the short-run, and then thrive in the long-run.

About the Author

Justin is a Forex trader and Coach. He is co-owner of www.fxrenew.com, a provider of Forex signals from ex-bank and hedge fund traders (get a free trial), or get FREE access to the Advanced Forex Course for Smart Traders. If you like his writing you can subscribe to the newsletter for free.