Maintaining trading discipline in anything is hard. This is especially true in trading and investing so we’ve produced these 5 handy tips to help get you there.
Firstly, “maintaining discipline” is unhelpfully vague . What it boils down to is the old trading adage:
“Plan the trade and trade the plan”
The way top traders maintain discipline is by making a trading plan and following it. Precise methods to plan and execute that on that plan are another subject. Here we have outlined our 5 tips to improve discipline.
1. Reward yourself
Let start with a nice one! If you are disciplined i.e. you plan a trade and then trade that exact plan then give yourself a treat, just something small that you like - in Geneva it tends to be Swiss chocolate!
2. Schedule leisure time
If you don’t plan some time off to enjoy yourself, you will end up taking it anyway but probably when you shouldn’t be and it will disrupt your trading.
3. Cut down on coffee
This one won’t be popular! But it’s been proven that too much caffeine reduces concentration, making you more likely to get distracted. It goes without saying that you need to stay away from alcohol when making trades or investments.
4. Identify daily distractions
The single biggest distraction is your phone. If you can’t turn it off, turn off notifications when you’re trading and only take a call if you really need to. Plan out a set time to browse before or after trading.
5. Go to bed on time
If you don’t get enough sleep, it is much harder to focus and the temptation to cut corners on your trading plan will be much higher. Studies suggest the most restful sleep is before midnight.
Don’t try all the above at once. They may seem simple but you need time to establish a pattern of behaviour. Try one at a time and the extra ‘discipline boost’ you will notice by doing it should encourage you to eventually implement them all.