Focus on the task at hand, not on daydreams about the far distant future.

Feb 15, 2021

We talked about self discipline and commitment, today I will tell you a little about focus.

In one of the earlier postings I had mentioned that emotional self-control is necessary for good trading, but by now we know that is not sufficient. Good trading  is a complex formula and while exchanging opinions with other traders, I came to the conclusion that a state of superior focus and enhanced concentration void of distractions tremendously improves the experience of the market related activities and information processing.

So what is Focus? Focus is the state or quality of having or producing a clear definition

(Zen master Phil Jackson called it “ being in the zone”). It is a skill and it will improve with practice.

What does it take to have the focus needed to be truly effective?

There are two elements:
Priorities and concentration. A person who has priorities (and plans) but lacks concentration knows what to do but can’t get it done. I equate this to excellence without progress. When the individual is committed and embraces both the potential for greatness is unleashed.

Short-term trading is a function of pattern recognition and pattern recognition hinges upon our state of awareness. If our attention is divided by outside noise (everything that takes place outside of trading) or by situations that can create emotions (remember the mood elevator) there is a loss of effectiveness that negatively impacts our ability to get and stay in the zone of information processing.

When we are super-focused, we create a cognitive environment in which trading psychology problems *cannot* dominate and we can stay in the zone.

So… after all these words what should you do to focus time and energy effectively?

Be prepared. A successful trader isn’t only successful because of what they do during market hours but what they do before and after market hours are long closed.

Being prepared breeds a calm atmosphere which allows you to keep your focus when the market does something unexpected, or doesn’t go your way. If you’ve already planned out what to do in times of unexpected volatility, you’re not likely to freak out. Instead, you’ll be calm, collected, and confident! Must have and be committed to a  plan.

Stay calm. Remember the mood elevator and keep your stress level in check. If you don’t it will have detrimental effects on your trading. If you let stress get the best of you, you may get trading paralysis as the fear of the unknown and anxiety cause you to second-guess your analysis. Meditate (your choice…before, during a break and after trading) if you believe that it will help you with concentration. It will lead to better concentration, calm under pressure and improved overall performance.

Stay confident. Don’t let losses or negative situations affect the confidence of new trades, don’t let fear sink in and prevent you from taking trades. You must trust and stick to  your trading plans and have confidence that over the long run you will prevail.

Develop an edge. What would it take for you to go to the next level in your main area of strength? What new knowledge or tools do you need? What do you need to do to overcome your weaknesses? Review how you do things and be willing to make sacrifices. Time and money spent to take you to the next level are the best investment you can make.

Effective individuals who reach their potential spend most of their time on things they do well. Focus on your strengths and further develop them. That’s where you spend most of your time, energy and resources.

Growth equals change. If you want to get better you have to keep improving. That means you have to learn new things. Things that either you do not know or things that you had limited exposure too and address areas of weakness (if you are not sure what they are , take courses, take evaluation quizzes, talk with other traders).

How do you rate yourself in the area of focus? Is it as sharp as you want it to be?

Because… the sharper it is, the sharper you are.

Now, go on, get in the zone and stay focused on the task at hand (personal or trading).

Trade safely and confidently.

Do not answer the phone.If you are an active trader, keep your cell or business phone off (except for emergencies) while you are trading . These conversations will distract you from the task at hand. Imagine the person you are talking to brings negative energy or causes you to become emotional thus further breaking your concentration.

Stay off the Internet. It is easy to start surfing the web. Before you know it, you are checking email, looking for news and quickly go to amazon and….before you know it, the trade you were waiting to take did so and you missed the trade.

Review Your Rules Throughout the Trading Day. Most traders review their plans during off hours but not while they are trading. If you want to make sure you do not go off, have your plans in front of you as you trade.

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