How To Stop Taking “Boredom Trades”

How To Stop Taking “Boredom Trades”

by Gary Dayton

Traders sit in front of the screen all day watching the markets, and if they don’t see a trade, they may force one just out of boredom. Traders sometimes feel they must be in the market, and it can force them to take trades they shouldn’t be taking. These are boredom trades and boredom trades seldom work.

Trading can be boring at times, and if you’re sitting in front of the screen all day, it can be like watching paint dry.

The thing to keep in mind is that "trading" does not mean pushing buttons all day. You are still "trading" when you are simply monitoring the markets for the next opportunity.

Characteristics of Trading Boredom

At a live trading event I recently attended, the markets just went dead. There was nothing happening. Traders started to show all the characteristics we commonly see from boredom. They got distracted. Some were surfing the Internet. Others were chatting. Some were writing emails and checking texts, and still others were dropping down a time frame to see if they can find a trade there. The latter group were trying to make what I call a “boredom” trade: trying to force a trade that really doesn’t exist.

It’s very easy to get "chopped up" trying to trade a flat market when you are bored.

What Really Happens When We're Bored

When we’re bored, we lose interest in the immediate experience. Our mind doesn’t feel engaged. It starts to demand more novelty and more stimulation. It’s the mind telling us, “Hey, I don’t like reality. Change it.”

Responding to our mind’s demands for more excitement is what gets us into trouble. Traders become absent-minded and suddenly the market takes off. They find themselves on the sidelines as the market come to life because their minds got them to do things other than attend to the market.

It’s not the situation that’s really the problem; it’s our response to it. And, most accurately, it’s not so much our response to the boredom as much as it is our response to our minds’ demand for more novelty and stimulation.

We respond to the mind. We buy into thoughts like “This is so boring. I need to have something happen.” It doesn’t feel comfortable and we want to escape the current situation. So we start to make marginal trades or become distracted and lose focus.

Two Ways to Deal with Boredom Trades

Here are a couple of quick tips to counteract our tendency to become bored. One is very simple: take a break. Take periodic breaks throughout the day. It’s basic, but many traders forget this.

Every hour, take five or ten minutes off, and when you do this, don’t sit there and start surfing the Internet. Get away from your trading desk. Go off and take a walk, get a snack, or do a little exercise. Do something different, and preferably something physical. It gives you that mental break so that when you come back to the trading desk, you’re refreshed.

The second tip—and, a very important one—is to begin to become aware of what’s going on between the ears. Start recognizing the stories the mind is telling us.

When we start looking for trades or when we start checking our favorite websites because we’re bored, recognize that for what it is: the mind demanding you change reality and give it more stimulation. Then ask yourself, “Is this really helpful to my trading?” You are now in a position to make the right choice.

Awareness of what the mind tells us is an important mental skill in trading, and developing it something we all need to focus on.

You can easily access several free resources at Gary Dayton's website that can help you do develop mindful awareness and other mental skills important for your trading.

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