The relationship is an inverted U. Too little arousal and you are slow, inattentive, and prone to boredom errors. Too much and attention narrows, working memory shrinks, and you revert to habits rather than judgement. Between them is a band where you are alert and still thinking.
The important refinement is that the optimum depends on the task. Simple, physical, well-drilled actions tolerate high arousal. Complex judgement under uncertainty - which is what discretionary trading is - peaks at a much lower level than most traders assume. The excitement of a fast market is usually past the peak, not at it.
This makes arousal something to manage in both directions: raise it when a quiet afternoon has you drifting, lower it when a volatile open has your hands shaking. See arousal-regulation.
Related: arousal-regulation, stress-response, boredom-trading, cognitive-load