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Taking a Vacation as a Trader: Why it’s Necessary
The world of financial trading can be an addictive endeavor, especially if you’re a part-time trader however, anyone who has traded seriously knows it can be more stressful than a full-time job, given the global nature of the financial markets, not to mention the profits and losses that are potentially at stake. For this reason and many others, it’s very important to take a vacation from the financial markets from time to time.
For starters, the global financial markets are active virtually 24 hours a day, five days a week. Although this is less relevant if you’re trading stocks listed on one exchange, there are several factors that may impact your security the very next trading day. The markets don’t only react to supply and demand, but to news releases, central bank policies and economic data. Forex traders have it especially bad because the currency pairs they are trading can go up and down in the middle of the night while they are asleep.
The point here is to demonstrate that serious traders are constantly in the know about what’s happening around the globe. From the start of the Sydney session on Monday, traders face a rollercoaster ride of data and events they must quickly analyze. Clearly, this rollercoaster cannot go on forever. That’s why taking a vacation from the market is important; time away helps you reduce stress and refocus, which will make you a more productive trader in the long run.
Studies have shown that taking time away from work is just as important as diet and health. That’s because vacations protect against burnout, reenergize your mind and body and contribute to emotional health. Studies also demonstrate that the type of vacation you take can be equally as important. Going on an adventure that lets you try something new can be a huge dopamine-booster.[1]
Ultimately, a healthy mind and body lead to increased productivity and clarity once you return to the trading screen. After all, being a good trader is all about exercising good judgement; your ability to do that is greatly reduced when you’re tired, stressed and approaching burnout.
Still not convinced? Consider that even the financial markets shut down on national holidays. For example, the New York Stock Exchange is closed on nine holidays throughout the year and closes early on three extra days. Even around important holidays like Christmas, trade volumes are generally much lower than at other times throughout the year. If you’re still worried about taking time off from the markets, schedule your vacation around key holidays.
If you’re still unsure, just remember that even bankers, financial analysts and hedge fund managers receive vacation time. If they can unwind from the markets from time to time, you surely can as well.
Once you’re on vacation, make sure to completely disconnect from the financial markets. Perhaps the best way to do this is to close all of your positions before you go on vacation. This will leave you much less incentive to check the financial ticker or open your online trading platform. If you’ve traded successfully, a vacation is a good time to spend a little of the cash you’ve worked so hard to earn. While away from the trading screen, your goal should be to simply disconnect, unwind and reenergize your body and mind.
[1] Joe Robinson. “The Vanishing Vacation: Why You Need a Break.” National Geographic.
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