While many traders might not ever give it much thought, the biological changes that the human body goes through when participating in the markets should not be underestimated.
With terrifying lows and dizzying highs causing dramatic physical and emotional feelings that impact sound decision-making, it is a little wonder even professional traders burn out quickly.
For centuries philosophers have pondered the stark distinctions between the seemingly similar feelings of pleasure and happiness. For one, the instant dopamine-inducing rewards of pleasure can lead to a slippery slope of addiction, compulsive behaviour, and chronic stress that only compounds the chemical’s ability to wreak havoc with rational decision-making. While serotonin-promoting happiness and contentment, often generated through fulfilling and enjoyable endeavours, are considered the key to a long life.
The relevance to trading could not be more pertinent, as both dopamine and serotonin play a role in balancing the body’s systems to function at their best.
In the world of trading, some do it for the love of the process, for years and years, even when they are billionaires. They enjoy building, growing, and learning new things and applying a quality strategy, happy and content in applying a system they have built.
While others end up chasing excessive rewards, creating chronic stress, and increased dopamine levels that result in Jekyll and Hyde transformations that destroy one’s ability to make good decisions, further compounding a vicious cycle.
However, there are simple methods to give the brain and body the best chance of maintaining the correct balance. Sleep, exercise, and a healthy diet are essential to optimizing serotonin, mood, and memory function.
In the same way, world-class athletes maintain standout levels of drive and self-discipline that permeates every part of their life, those that want to successfully trade for years to come must be truly cognisant of the high and low cycles that impact their inner Jekyll and Hyde. And do what is necessary to keep in control.