by Adrienne Laris Toghraie
Trading is unique in that the uncertainty of the markets brings to bear an unusual stress level. What should you do if your trading suddenly turns south, or worse, a tragic event occurs?
Recently, I was in an automobile accident when a cab driver sped through a four-way stop sign as I was entering the intersection. For a spell, I felt lost in time. In that moment of unreality, I even thought that it was all a dream. I was in shock.
What is shock? According to the dictionary, it can be a sudden, jarring impact or the result of a disturbance in your equilibrium; it can also be the reaction to a strike with surprise, terror, or horror.
Traumatic events can cause a state of shock. In the best of all circumstances, a person can go through life without one, but such a utopian existence is unlikely. Since successful trading depends on good performance, it is important that a trader have plans in case of any disastrous event. Being unprepared could be very costly, both emotionally and financially. Whether it is the resulting shock from an accident or the shock of realizing that your trading account has been wiped out by the markets and there's nothing you can do about it, it's still the same: Disaster has occurred, and you couldn't control it.
Immediately after the accident, I just sat in my car, trying to figure out whether the next world war had started. A concerned face popped up and asked how I was. For a split second, I just wanted to say, "Obviously, I'm not okay!" But all I could say was, "I don't know." The one thing I did know, however, was that it was time for me to let others take control.
Excerpted from an article originally published in the January 1999 issue of Technical Analysis of STOCKS & COMMODITIES magazine. All rights reserved. © Copyright 1998, Technical Analysis, Inc.