Dr. Steenbarger wrote an excellent series on FOMO (Fear of Missing Out) with solutions to help traders with this issue. In one post, he mentioned our work together coaching and mentoring traders at SMB.  Specifically he outlined three ideas to improve FOMO, and for which I would like to contribute my thoughts and hopefully supplement his writing.

1) Mindfulness

We recommend in our training programs that traders include in their Daily Routine mindfulness training.  A good place to start is the HeadSpace app.

Mindfulness training will help you observe a trading loss and not take it personally.  It will help you focus for a more sustained period of time and with greater intensity.  Also, it will help you remain in an optimal psychology state of calm, while trading.

2) Reasses the severity of threat

Traders on our desk are taught to trade their PlayBook.  Repeatedly, our coaching and mentoring centers around helping traders trade their PlayBook in real-time.  Forced trades bring unnecessary losses, for example.  Sizing too small and PnL not recognized in Aplus trades becomes obvious, with a quick review of their PlayBook.

Your trading business is to trade your PlayBook.  Stocks selected that are In Play but do not offer trades in your PlayBook should not be taken.  It is not enough for a stock to be In Play, it must also setup with an opportunity from your PlayBook.  When traders think of trading their PlayBook it is easier to accept large moves in stock that they did not participate.  They think- It is not a trade in my PlayBook.

But seriously Dr. Steenbarger make such a terrific point about how nonsensical FOMO is from trader.  I wrote about Prep in The PlayBook working on these issues with his trading,  There are large moves about to hit in stocks on HKE, LSE,  DAX overnight.  Will you awake and fret about misses there?  If not, then feel anxious about movement in stocks outside your PlayBook?

3) Directing attention outward

On Team Shark junior traders get to learn and be mentored by one of the top short-term traders.  They often trade and watch the same stocks.  They ALL attack these opportunities differently and with success.  They have had to.  They are not capable of trading exactly like him.   They must draw on their own unique talents and interests to create a PlayBook and trade that PlayBook at their best.  Focus on what you need to do to produce your best trading.

I hope this has contributed to Dr. Steenbarger’s series on FOMO.

Trade well.

*no relevant positions

*I am on vacation with family until next week.