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Stress response

The physical cascade - adrenaline, then cortisol - that prepares you for threat and degrades exactly the abilities trading needs.

A threat, including a financial one, triggers a fast adrenaline surge and a slower cortisol rise. Heart rate and blood pressure go up, attention narrows onto the threat, and the systems that handle planning, probability, and impulse control lose priority.

In front of a screen this produces recognisable behaviour: fixation on the open position, inability to see other instruments, a strong pull to act immediately, and time distortion. It also degrades memory of what happened, which is why traders often cannot reconstruct their worst twenty minutes.

Two consequences follow. Reduce the trigger by sizing so that a normal loss is not a threat, and recognise that once the cascade has started, the fastest route back is physical - movement, breathing, distance - not argument.

Related: adrenaline-dump, arousal-regulation, sleep-debt, scared-money

Educational only, not advice. Spotted an error? Post in Site Feedback.