Many seasoned traders say that cultivating a peak performance mindset is the key to trading profitably. For example, there are moments when everything just seems to click. A trader is in tune with the ebb and flows the markets. He or she senses what will happen next, and with absolutely no self-doubt or hesitation, he or she can freely and effortlessly execute trade after trade.

At that point, the trader moves into a higher level of psychological existence, losing his or her sense of self in the process of trading. All attention is focused on trade. It’s a pleasurable, rewarding mental state. It isn’t the case that traders experience the peak performance mental state all the time, and maybe it isn’t necessary. But it’s a good idea to strive for. Whenever you can cultivate a peak performance mindset, you’ll be trading at your best.


What is the peak performance mindset? There are many different names for it: “the zone” or “flow.” Peak performance states were originally studied by psychologist Abraham Maslow who studied self-actualized people who often reported peak experiences where they experienced a higher level of existence. Recently, psychologist Mihalyi Csikszentmihalyi has studied people who experience “flow.”

Flow is an optimal mental state. It’s a pure joy a person experiences when he or she engages in a challenging activity for its own right. All attention is focused on the task at hand. It’s so engaging that one’s sense of self is lost in the task. One of the best examples of flow is mountain climbing. It requires focused attention and it’s extremely challenging.

Research studies have shown that flow experiences tend to occur when eight conditions are met. The more you can meet each of these eight conditions while trading, the more trading will be an enjoyable flow experience for you. Let’s consider the eight conditions and how they might be met.

First, the task or goal must be possible to complete. In other words, immediate goals can’t be too abstract or too high. When it comes to trading, for example, it is best to just execute a trade rather than being overly concerned with profits or achieving unrealistic performance standards. Second, a person must be able to intensely concentrate on what he or she is doing. While trading, it’s vital that you have a detailed trading plan and control risk so that you can focus on monitoring the trade.

It’s also essential that you maintain control over your psychological conflicts and life stressors so that they don’t interfere with your concentration. Third and fourth, the task must have clear goals and immediate feedback. Perhaps trading tends to be a flow experience because the goals are often clear and the feedback immediate. Again, a detailed trading plan helps you keep the goals clear. Similarly, the proper signals specified beforehand allows for immediate feedback. Fifth, a flow experience involves deep and effortless involvement.

People are so involved that the everyday worries of life tend to be cast aside. Sixth, while in a flow experience, people have a decisive sense of control over all their actions. Seventh, one loses one’s sense of self while in a flow experience. Some traders report that when they are engaged in trading, they are so focused on their experience that they are no longer self-conscious; there is no self-doubt or self-reproach. They just focus on trading. Finally, time seems to just slip away while in a flow experience. Hours can go by like minutes, for example.

Under the right conditions, trading can be a flow experience. In the end, you have the choice as to how you approach trading. Do you approach it as a flow, or peak performance, experience? Or are you approaching trading as a chore, a means to an end? If you approach trading for its own sake, as an intrinsically rewarding, enjoyable experience, you will trade more profitably in the long run. And more importantly, you’ll enjoy the journey along the way.

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