As a binary options trader, you have numerous tasks to see to everyday. In many ways, trading for a living is very much like going to university on a full-time basis. You constantly need to be adding to your knowledge by researching and testing, all while carrying out live trades for profit.
To add to the challenge, the majority of binary options traders are not yet doing this exclusively. Most are also working at a day job, usually full-time. That means that you need to be twice as productive in order to keep up with your dual responsibilities.
Chances are good that you spend a lot of time and energy trying to figure out how you can optimize your productivity. In a previous article, I shared a number of productivity secrets for traders with you. In this article, I would like to address productivity myths which may be standing in your way.
- The longer you work, the more you will accomplish.
- Multitasking leads to efficient output.
- Early to rise, early to profit.
- You don’t need breaks, you need to just grind through.
- You need to always be busy to be productive.
- You work better under pressure.
- You should always tackle the hardest/easiest work first.
Let’s look at each of these in detail.
1. The longer you work, the more you will accomplish.
This is probably one of the most pervasive and damaging productivity myths—for traders in particular. You reason to yourself that if you spend more hours working, you will get more done, because you are giving yourself the time to do it in. I believe that this myth usually stems from desperation resulting from the constraints of trying to balance two or more jobs.
The problem with this assumption is that it does not take context into account, or your physiological or psychological limitations. If you were to trading robot, it would make sense to assume that working longer hours would result in more winning trades. But a trading robot does not get tired or distracted. It does not need to eat or sleep. It does not need to get its mind off work.
Unlike the trading robot, you cannot focus on treating indefinitely without breaks. The longer the hours you work, the more you will fatigue yourself. You may think that working until two in the morning is a great way to catch up on tasks that you are behind on. But think for a moment about the next morning, and how you will feel when you have to wake up again at 6 a.m. for your day job. You may get a lot done today, but you will likely to be so exhausted physically and drained mentally that you will undo it all the next day by slipping even further behind.
Working longer hours does not lead to accomplishing more. It may work for a little while, but eventually fatigue will build. When it does, it will undo all that progress.
So do not focus on working longer hours. Focus on finding ways to accomplish more within the same time. Outside of that, you may just need to have patience. It is far from easy trying to balance two jobs. It takes time (usually years) to build a trading career while working at another job. But if you stick with it, you will get there eventually. Hang on to your day job and you will be able to build up your trading account while you are learning and testing.
2. Multitasking leads to efficient output.
The modern obsession with multitasking is so well-ingrained in our culture you may never even think to question it. But multitasking is not everything that it is made out to be.
Like working longer hours, it seems intuitive that it would lead to getting more done. After all, if you can monitor three trades, post on a forum, talk on the phone, and work on a document for your day job all at once, surely you can get six tasks done in one-sixth of the time, right?
The glitch in this thinking has to do with a process called task-switching. When you are working on more than one task at a time, your brain is constantly “switching” focus between them. Each task carries a set of rules and goals, and your brain needs to switch from one set of rules and goals to the next and back repeatedly. These are actually two distinct phases referred to as “rule activation” and “goal shifting.”
Here is an article by the APA which delves into this process and its price. Every time you “switch,” it turns out that there is a time cost. Usually the cost only amounts to a few tenths of a second, but think about just how many switches you are doing as you multitask, especially if you are doing a lot of tasks at once. The more you try to do, the more switches you have to make, and the more switches you make, the less efficient you become. According to the research I just linked to, that could end up costing you 40% of your time!
So in binary options trading, I suggest not trying to take too many trades at once or juggle a lot of different tasks at the same time. Plus, in trading, multitasking carries the additional danger of distraction. It is already hard enough to focus on your trades. Why would you want to divide your attention when you need to be alert to the slightest change in the market?
3. Early to rise, early to profit.
It is often said that “the early bird gets the worm.” Have you ever wondered whether that is really true, or have you always just gone with it your whole life? Our nine-to-five work schedules (which usually start a lot earlier in the morning than that when you account for commuting) certainly encourage it.
We know what society says, but what does science say? Well, this study by Christopher Randler is certainly the most famous, and it does indicate that early risers are more successful. What this data actually means however is unclear. It could mean that early risers are more productive, but it could also just mean that society is already rewarding them. After all, the typical work schedule definitely caters to the early riser and not the night owl.
Here is a study that actually shows that some of the best bursts of creative insight may occur during times of the day which are traditionally considered less than optimal. So that is evidence that productivity is not the sole domain of early birds.
Even Christopher Randler himself said in his study that companies need to take steps to “bring out the best” from workers who are not morning people.
So really, as a trader, you should be taking similar steps to bring out the best in yourself. This is true whether you are an early bird, a night owl, or something in between. You need to figure out when you are most productive. Then, if possible, you should try to arrange your schedule around that timing. If you work a day job, this may not be possible, but if you do nothing but trading, you can choose your own hours. The constraints of trading itself may still push you to be active during certain hours, but to whatever extent you can control your schedule, you should cater to your needs.
You don’t need breaks, you need to just grind through.
Another common misconception about productivity is that you just need to power through the times when you feel like quitting. To some extent, this is true, but this technique has its limitations.
Willpower is actually a limited resource—as demonstrated by scientific research. It is not a constant as we tend to believe.
Likewise, if you feel your willpower declining, it does not mean that you are weak or inferior in any way. If willpower was some kind of constant, perhaps this would be true, but since it is a measurable resource which can be depleted, it does not reflect on your character at all. It just means you have been working too long and hard.
You do need breaks. If you take a look at the article I linked to above, you will see that taking breaks from acts of willpower is actually helpful in replenishing it so that you can use it on other tasks.
That means if you need to take five minutes to do something totally unrelated to trading every half hour, you should. If you need to take a day off, go for it. Doing so will allow you to replenish those valuable stores of will so that you can stay as productive as possible.
Plus, there is an additional benefit. If you deplete your willpower too much, you can actually enter into a state known as “ego depletion,” identified by the same scientist who did the research on willpower as a limited resource. When this happens, your capacity to make smart judgment calls suffers and you begin taking irresponsible risks. This amounts to going on tilt. This is a subject I go into in-depth here.
Sometimes you need to power through, but other times, you really do need to back off from your work for a while! That way you can stay productive and level-headed.
You need to always be busy to be productive.
Another myth about productivity is that being productive = staying as busy as possible. But try to remember the root of the word “productivity.” It comes from the same word as “product” or “produce.” If all your busy work is not producing some kind of result, then you are actually not being productive at all. It is just an illusion.
That means that you should make it your goal to do whatever you need to in order to maximize your output—not just your input! It call comes down to working “smart, not hard.”
In other words, you could actually discover that you are more productive doing less busy work. Take a long, hard look at your to-do list and figure out whether everything you are doing each day is really necessary.
Also ask yourself why you are so busy. Is it really because all those tasks are important, or is it because it makes you feel like you are moving forward? Oftentimes we actually keep ourselves busy to stop from seeing how unproductive we really are.
Ironically, despite the fact that you will frequently be pressed for time while trading, there will be long time periods where you are doing a lot of waiting as well. It can be hard to get through those times without feeling like you are wasting time, but it is important to learn the difference between waiting and wasting time.
You work better under pressure.
Most of us have some memory in the past of a time when we were under a great deal of pressure and were able to achieve more than we ever thought possible. It might have been a school assignment you out off until the night before the due date, or it could have been a work assignment. Either way, you marveled at your accomplishment, and concluded that you could not have done it had you started work earlier.
Pressure certainly can help you tap into reservoirs of thought and energy you did not know you had. But that does not make it the best choice to maximize productivity on an ongoing basis. Occasionally, it can generate results, but if you are under pressure all the time, that stress is going to erode at your capabilities. Chronic stress can lead to anxiety, depression, and distraction. It can fatigue you psychologically and physically.
When you reach that state, you can no longer function at your best. That means that you will become less and less productive.
The other issue with working under pressure is that we tend to define pressure as “working without preparation.” Why were you working under pressure on that last-minute school paper or work assignment? Because you procrastinated and left it all to the last minute.
If you do that with trading, you are asking for disaster. You cannot sit down to trade and make snap judgments about what you see. That is true even if you are a scalper making fast trading decisions on the fly. You still need to have as much of a preparatory framework in place as possible to guide your decisions. You should never feel like you are under pressure to figure it all out at the last second.
You are already under plenty of pressure as a trader; it is a high-stress job even without you taking pains to make it more so. Let that basic pressure of uncertainty motivate you if you need it to, but otherwise try to take steps instead to make your life easier and more predictable.
You should always tackle the hardest/easiest work first.
There are two myths about productivity which I seem to hear again and again, and they directly contradict each other:
You should always tackle as much menial work in the morning as possible.
You should tackle your most challenging work in the morning if you can.
There is understandable thinking underlying both of these ideas. In the first case, the thinking goes that you should get as much work done as possible while you have the energy and clear thinking available to do it. That way the majority of your tasks for the day are out of the way and you can really concentrate on the more challenging ones.
The thinking in the second case is that you should use all that clear thinking and energy to get the daunting, challenging tasks done right away. Otherwise, you will have to do them later while you are already in a depleted state.
These are actually both pretty logical arguments, and which case applies to you really depends on how you work best. Some people hate knowing that there is a challenging task hovering over them waiting for them at the end of the day, while others hate knowing that the majority of their work is still ahead of them and they spent the whole morning on just one task.
I recommend that you experiment and try different ways of arranging your time. It should actually be pretty easy to figure out from your own experiences and observations what works best for you. The myth here is that there is one right way of doing things. There isn’t. There is just whatever is right for you. That may be doing the easy work first or the hard work. It may even be doing it one way today and a different way tomorrow.
Now that you are familiar with some of these productivity myths and you can see why they are misconceptions, you should be ready to make some adjustments to your own work schedule and techniques. Hopefully you will soon be working smarter instead of harder. Trying to trade for a living is a challenge for even the most efficient worker, especially if you have a day job as well. But once you start maximizing your productivity, you will be amazed at what you can achieve!