From The Economist, a piece studying judicial rulings:
Decision making is mentally taxing and that, if forced to keep deciding things, people get tired and start looking for easy answers.
As active intraday traders do we hit a point where we want easy trades? Do we stop thinking as thoroughly as we should after a series of trades on the Open?
Is this part of the reason why you hear the banging and screaming on some desks? Some traders are just tired of doing all that thinking and just want an easy trade that doesn’t require a lot of thought. I have sat at a desk where uber-bright traders don’t simply get pissed when a trade doesn’t trade in their favor. They’ll often step back and say something like this:
OK, so that stock didn’t break out like I thought it would. Let me sell some and reevaluate. This is just a failed breakout and let me think through what might happen next. The market just gave me some valuable information and I will use it with my next trade.
But sometimes it’s the mostly cool traders who start the banging and screaming, yelling at the stock for not acting as they had predetermined. Maybe they’re just tired of having to now think deeply about the best next course of action. That is a lot of mental energy. They just wanted that last idea to work so they could stop thinking.
You do need to step away from your trading screen from time to time during the day and then come back refocused. This does not mean a two-hour lunch. It does not mean getting up and quickly talking to a trading neighbor about a trade. It does not mean five, twenty-minute cigarette breaks throughout the day talking Celebrity Apprentice. (I’m always amazed at how many non-smokers start smoking after they start trading. Is the habit developed in place of doing your trading work?) Stepping away does not mean constantly Gchatting with your buddy About Last Night. Stepping away means taking a lunch break and then going back to work. It means taking a quick break after the Open and perhaps one into the Close while still staying in touch with the market and your best trading ideas. Refresh and then refocus. This leads to better trading decisions.
You can be better tomorrow than you are today!
no relevant positions