Riding the momentum waves

Riding the momentum waves

Flashback pre 2009 – I was then a commodities hedge fund manager trading a suite of commodity futures and options products.

With several screens hanging above my desk, all that could be deciphered by the untrained outsider were red and green prices that dominated the screens. And during turbulent volatile markets these figures would flash rapidly every split second turning red as prices tumbled or green as they soared higher. There were often large swings and if you looked away for a moment you might return to find that prices were nowhere near their original level.

During explosive times many traders can identify with being on one of those yachts having to ride the highs and lows of stormy waters caught in a weather system. There’s often a taste of fear and emotional tension. Traders try to make sense of market movements and scramble to protect their investments. Some are like rabbits startled by headlights in the dark not knowing what to do next, as thoughts are scrambled in their minds. However, there are those who are able to ride the waves and participate with confidence leaning into the fear and challenge of the occasion.

Momentum swings and turbulence on the trading floor is not too dissimilar to those times on the field, pitch or court when things don’t go as planned and the tides suddenly turn. Some athletes at first are startled, then filled by fear and emotion unable to make clear decisions as their minds are cluttered by anxious thoughts of defeat. Others blank out, unable to focus on anything.

Just as those yachts eventually pass through the weather system into calm expanses of water though, you can adapt and find yourself back in a zone of confidence and comfort .

So how can you manage when turbulence hits? Here are my 5 key lessons to help you ride through those changing moments?

1. Notice the change

Build those self awareness skills to recognize the subtle changes in your environment, body and mind. Without awareness you are unable to adjust. Body check to see what shows up.

2. Time out

Slow things down. When momentum hastens and turbulence hits, fear starts to raise it’s head, but don’t feed it with more thoughts of doubt. Notice those thoughts and emotions, label them and accept them without judgment. Then find some space for a moment and calm your mind. When at that trading desk, I often had a Kit Kat break to take me completely away from the scene of trading chaos. Okay, perhaps I should have made it a healthier choice, but this was my little indulgence! Find that space to allow yourself some time to clear the chatter in the mind. This can be between points, when the ball is out of play, during those quick drink stops. Remind yourself that calmer seas will return. Breathe……….and then return to the moment.

3. Take stock and recalibrate

Now recognize what has been working well so far, what weapons you have that can still be used in the new dynamic, and lastly trust in your strategy. While your strategy remains the same, adjust your tactics to deal with the changes and stay committed to your values.

4. Engage with purpose and remain in the present

As you turn back to perform, let every action have purpose rather than be reactionary. Don’t drift to the emotional chaos of the past or think about the outcome ahead. Ground your attention by focussing on something that will help you back to the present moment. This could be an equipment item. On the trading desk this was the mouse for me. Placing my hand purposely on the mouse signified readiness. Then engage in the moment with commitment to the process.

5. Embrace the challenge

Just as surfers would rather have waves than none at all, get on that trading desk, field, pitch or court and enjoy the challenge and the journey you’re on. Ride the waves of the new situation. Volatility often presents opportunities and you may surprise yourself with what you’re capable of. And if you don’t quite turn things around, you’ll still be able to learn from your experience. Static situations can be monotonous, and they provide little opportunity for growth.

 

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