Last Updated on October 1, 2024
Sun rays peeking through the trees, the aroma of freshly brewed coffee, and a breath of fresh air while looking at serene greenery – can you imagine a better way to start your morning?
While not all of us can have that, it is essential to always start your morning with a routine that will help you feel both energized and at peace – especially those working in a highly stressful and dynamic environment (funded traders know what I am talking about).
As the world wakes up, a trader’s mind already has to be sharp and tuned into the rhythm of the markets. And the best way to do that is by crafting and following a strict morning routine for funded traders. In the following lines, we will focus on how you can do it.
The Importance of a Morning Routine: Setting the Tone for a Successful Trading Day
In trading, as in life, how you start your day often determines how the rest of it unfolds. The morning routine is a buffer between personal and professional life, allowing traders to transition smoothly into the high-pressure trading world. A well-structured morning routine can help eliminate distractions, reduce stress, increase focus, and ensure a sharp mind, which is all critical for making informed decisions in the fast-paced world of trading.
The first few hours are crucial for setting the tone, preparing mentally, and ensuring you are in the right mindset to face the market and handle your trades successfully.
Think of the morning routine not only as an essential habit but a ritual that will sharpen your mind and prepare you to navigate the day with clarity and confidence. The process very much resembles how elite athletes go through a series of warm-up exercises to prepare their body and mind for peak performance once they step on the field. Skipping the warm-up increases the risk of injury and diminishes performance. Similarly, a trader who skips their morning routine may find themselves mentally unprepared, emotionally reactive, and more likely to make impulsive decisions that could accumulate losses.
Hint: The morning routine is just a small part of a funded trader’s day. If you want to learn more about how to succeed throughout the rest of the trading day, check out our dedicated guide – How to Manage and Optimize Your Trading Routine.
Crafting the Ultimate Morning Routine For Funded Traders
Your morning routine is the time to think clearly, plan meticulously, and approach the day with the same precision that will define your trades. Here are a few helpful steps to consider when planning your morning routine to ensure you are well-positioned to conquer the markets once the opening bell rings.
Step 1: Start with a Clear Mind
Starting the day with a cluttered mind can lead to poor decision-making. That is why the first step in creating an effective morning routine is to clear your mind of distractions and stressors. In the high-stakes trading world, mental clarity is not just beneficial—it’s essential. As Mark Douglas, a renowned trading psychologist, once said,
The consistency you seek is in your mind, not in the markets.”
Mindfulness practices such as meditation, deep breathing exercises, or even a short walk can help clear and prepare the mind for the day ahead. For example, even five to ten minutes of meditation daily can significantly reduce stress and improve focus. According to a study published in Psychiatry Research: Neuroimaging, regular meditation increases the gray matter in the brain regions involved in learning and memory processes, emotion regulation, self-referential processing, and perspective-taking.
On top of the scientific evidence, there is also lots of practical proof from some of the world’s best and brightest. Ray Dalio, founder of Bridgewater Associates, one of the world’s largest hedge funds, attributes much of his success to his practice of meditation, saying,
Meditation, more than anything in my life, was the biggest ingredient of whatever success I’ve had.”
Meditation, deep breathing exercises, or a short walk can take just minutes, but their impact is long-lasting and potentially life-changing.
Step 2: Practice Gratitude and Positivity
Starting your day with a positive mindset can profoundly impact your trading performance. A positive mindset can help traders maintain emotional balance, reducing the likelihood of making impulsive, fear-driven trades. Many successful traders incorporate gratitude into their morning routine by keeping a gratitude journal, writing down three things they’re grateful for each morning.
Whether through journaling or simply reflecting on what you’re thankful for, practicing gratitude can set the tone for the entire trading session. It can help you maintain a positive attitude, shift focus away from stress and toward positivity, and stay resilient and focused, even when the market is tumultuous.
Research by Dr. Robert Emmons, a leading expert on gratitude, suggests that practicing gratitude can improve psychological well-being, increase resilience, reduce stress, and enhance overall satisfaction.
Visualization is another powerful tool that can help maintain a positive attitude. For example, many renowned athletes, entrepreneurs, and traders share that they have visualized success before achieving it. Taking a few minutes each morning to visualize yourself following your trading plan, making smart decisions, and achieving your goals can help build confidence and mentally prepare yourself for what comes next.
Step 3: Focus on Physical Well-Being
Physical and mental well-being are more connected than you think, and, similar to your mind, your physical health also plays a significant role in your trading performance. Simply put – a healthy body supports a healthy mind, so incorporating physical activity into your morning routine is essential. Whether it’s a workout, yoga session, or a simple stretch, getting your body moving in the morning can boost your energy levels and enhance your focus.
There is tons of academic research showcasing how physical activity improves focus, mood, and attention, thus directly affecting performance. For example, scientists find that even a short, 10-minute bout of exercise can enhance cognitive functions, including memory and attention. According to academics, done in the morning, even moderate-intensity exercise improves cognitive performance (e.g., decision-making) throughout the entire day. For traders, this can translate into sharper focus and better decision-making.
Step 4: Nourish Your Body and Mind
A question for those of you who have watched the famous trading-themed movies “The Wolf of Wall Street,” “Wall Street,” and “Margin Call” – have you noticed the similarity in the eating habits of the characters depicted there?
While this isn’t something you will prioritize when watching such exciting movies, it reveals a clear pattern – in the stressful and highly dynamic world of trading, people rarely have time to follow a healthy diet. Instead, they eat fast food on their desks so they don’t “waste” time and can return to their jobs asap.
A friendly advice – never do this. In the long term, it will cost you dearly. Instead, craft your daily ritual around healthier alternatives. Whether it is a vegetable-rich breakfast, granola, or a favorite sandwich, paired with a cup of coffee, tea, or orange juice, a nutritious breakfast is another crucial element of a successful morning routine.
There is tons of academic research proving that a diet rich in whole grains, fruits, and lean proteins can improve brain function, while high-sugar, high-fat diets are linked to impaired memory and cognitive decline.
Trading demands high levels of concentration and energy, and skipping breakfast or consuming unhealthy foods can lead to fatigue and reduced cognitive function. That’s why it is crucial to opt for a balanced meal with protein, healthy fats, and complex carbohydrates to fuel your body and brain.
Many successful traders follow a diet that supports sustained energy levels throughout the day, reducing the likelihood of mental fatigue during critical trading hours. For example, some traders prefer a breakfast of oatmeal with fruits and nuts, while others might opt for eggs and whole-grain toast. The key is to find what works for you and to avoid foods that cause energy crashes.
Step 5: Create a Distraction-Free Trading Environment
The trading environment significantly influences your ability to focus and make sound decisions. That’s why it is crucial to take the time each morning to organize your workspace, eliminate distractions, and ensure it is clean, quiet, and filled with everything needed to help you smoothly cruise through the day ahead.
Also, don’t forget that, as a funded trader, your trading environment reflects your mindset. A cluttered workspace can lead to a cluttered mind, making it harder to focus and increasing the risk of mistakes.
On the other hand, studies have shown that a clean, organized workspace can significantly boost productivity and reduce stress. According to research, individuals in tidy environments are more likely to make healthier decisions, concentrate better, and stick to long-term goals.
Step 6: Review the Markets
After you have prepared yourself and your environment for the day ahead, it’s time to dip your toes into the markets and do your prep. Most successful traders start their day with a “daily briefing” of sorts. And now that you are a funded trader, you should do that as well.
This step involves analyzing major financial news outlets for overnight developments, reviewing market-moving trends, assessing any economic data releases, and analyzing how these factors might impact the markets during the upcoming trading session. This step is crucial to know what you will be up against, develop a clear picture of the market environment, and identify potential trading opportunities. Making it a part of your morning routine as a funded trader will ensure you are informed and prepared, reducing the likelihood of being blindsided by unexpected market movements.
Step 7: Set Clear Goals For the Day and Review Your Trading Plan
Goal-setting is a powerful tool in any discipline, and trading is no exception. Your goals should be realistic, specific, and aligned with your overall trading strategy and plan.
Results from a review of laboratory and field studies on the effects of goal setting on performance by Dr. Edwin Locke finds that, in 90% of the cases, specific and challenging goals lead to higher performance levels compared to easy goals, “do your best” goals, or no goals.
For traders, this could mean setting targets for risk management, sticking to a predefined number of trades, adhering to a particular strategy, or aiming for a certain percentage return. Setting goals helps keep emotions in check and gives you direction and purpose, as the focus remains on executing the plan rather than chasing profits. Furthermore, having a clear strategy and specific goals can help you stay focused and disciplined, even when the market becomes volatile.
Before diving into the market, it is also essential to take a few minutes to review your trading plan – your roadmap for the day, detailing your strategy, risk management rules, and criteria for entering and exiting trades. Reviewing it each morning reinforces your commitment to following the blueprint and helps prevent impulsive decisions driven by emotion.
Think of your trading plan as a pilot’s pre-flight checklist. Before taking off, a pilot reviews every aspect of the flight plan to ensure everything is in order. This routine is critical for preventing mistakes and ensuring a safe flight. Similarly, reviewing your trading plan each morning helps you stay on course and avoid costly errors.
Don’t have a trading plan? Here is a helpful article on how to create one. Or if you aren’t convinced of its importance, just take a minute to think of the words of Warren Buffett, one of the most successful investors of all time:
An idiot with a plan can beat a genius without a plan.”
Making Your Morning Routine Count: Rinse and Repeat
While every single one of the steps above is crucial for creating a good morning routine, the key is being consistent and applying it every day. By following the same morning routine every day, you create a rhythm that helps you stay focused, disciplined, and mentally prepared. This consistency reduces the likelihood of making emotional or impulsive decisions, which are often the downfall of traders.
According to research by Dr. Wendy Wood, a behavioral scientist, habits account for approximately 40% of our daily behaviors. For traders, building consistent habits through a morning routine can help reinforce discipline and reduce the likelihood of deviating from your trading plan.
I realize that building a healthy habit or quitting a bad one can be a long and often challenging game. If you struggle with it, you can always lean on books (“Atomic Habits: An Easy & Proven Way to Build Good Habits & Break Bad Ones” is a great shout) or tools (e.g., a mobile app like Days Since to keep you accountable). Over time, this consistency will gradually become second nature, leading to more reliable trading performance.
In the end, don’t forget that creating the best morning routine for funded traders is about more than just checking items off a list—it’s about setting the stage (your mind, body, and environment) for a successful trading session. By incorporating the seven steps in this article into your morning routine and refining and personalizing your routine, you can approach the markets with clarity, focus, and confidence.
Remember, the morning routine isn’t just about what you do; it’s about how you do it. Start your day right, and the rest will follow. Where? Earn2Trade’s programs, Trader Career Path® and The Gauntlet Mini™, provide the perfect training ground to craft and refine your trading routine while at the same time positioning yourself for a funded trading career.
