April 5, 2015

Managing fatigue and trading

Question:

I feel its right time to get some guidance from you relevant to discipline on trading hours. Kindly throw some light on these areas.

By what time you are settling up your terminals and sitting in front of them to start trading. How focused one should be for the whole trading hours. How will you manage lunch time. From morning to 3.30 pm how you are keeping yourself focused to look at charts.

Coz around 11.30 I'm feeling fatique by 1 I'm feeling hungry or bored of looking at charts and leaving the terminal with no idea.

These kind of discipline oriented habits, I wanted to learn from your ideas. If you are free, make a post, that would be very helpful to traders who follow your posts or kindly reply me.

Albert Rajkumar

Answer:

Trading is a strenuous and demanding activity on the body. Intense concentration is required and with nothing happening for extended periods, you can have frustration, tiredness and fatigue.

Now to answer the questions in the order you raised.

I am an early riser and am up by 5.30am. I go for a short 20-30 min walk, freshen up, have breakfast by 7.30 and am ready for the day.

I start the PC around 7.30-8.00 - do a lot of reading (unrelated to markets), replying to emails etc. Sometimes I squeeze in another 30 min walk by 9.30.

My trading strategy is defined by what market does and it does not require deep study... I do trade a lot of intraday (nifty) and so have very clear buy above/ sell below levels determined from previous day charts. Sometimes markets open above this range so I wait for a range to develop and then the breakout of the range.

This means that if markets often do nothing for a long time intraday, it means there is actually nothing to do... like in this chart



You should not spend more than 30 seconds to decide what to do. And before you do anything, you should have a good idea of what you would do and under what conditions.

Here nothing happened till 12.30... intense concentration is just not required... you can read newspapers, play with your kid etc when the market is in a range. But the moment the breakout happens, then you should be in trade and from this point onwards, be attentive to what is happening.

The game here is to watch for sudden reversals and increasing the trailing SL.

I will admit here that 3 trades in a day is max what I can manage before fatigue sets in. Three trades also means that one trade is loss making and this can affect your emotional balance to some extent (tendency to ignore breakouts or a good trade).

Lunch is between 12.30-1.00 and is a 5 min affair (max 10 min). 

I shutdown by 3.35pm, crash out for 30-40 min (power nap?)... site and blog updates start by 4.30pm. Another long walk in the evening, a light dinner by 8.30 pm and lights off by 10pm.

The above applies only to intraday trades. In comparison, delivery trades are like a vacation - you check prices only after market close.

Couple of things to note

Sleep is the most important factor. Target for a good 8 hours sleep everyday - this should include a max 1 hour power nap or siesta in the afternoon.

Diet: if you are feeling sleepy in the day, chances are you are eating wrong. Cut down on carbs (rice/ roti/ bread etc), increase protein. I eat 1 roti a day and a small bowl of rice but lots of vegetables.

Eliminate junk food from diet completely... it has no nutrition and will make you sluggish.

You can also look to eliminate or cut down on sugar and salt from your diet.

Eat loads of vegetables... the fresher the better. These are an excellent source of vitamins, minerals and fibre.

Eat whenever you want... I eat 5-6 times a day but my overall calorie intake is under 1800 cals per day (BTW 1 samosa = 250 calories). 

Check your vitamin levels for persistent fatigue. Important ones to check are Vitamin D3 and B12.  I recommend Arogyam 1.3 test from Thyrocare.

I can write a crazy amount of stuff on food and nutrition as this is another of my favourite areas of research. But let's leave this for another day.

Hope this helps.

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