World stock markets tested investors’ ability to remain calm early this year. In the last half of January, S&P’s index of the total U.S. stock market fell more than 5 percent. During that same period, international stocks, led by emerging markets, fell 6 percent in two weeks. While the financial media was busy making silly “get out now” proclamations, market indexes recovered nicely. Smart investors weren’t shocked, though. These market events are normal and occur like clockwork.
Aside from working with a trusted advisor and a solid long-term plan, how does a successful investor stay unruffled during volatile periods? Travis Bradberry, Ph.D., author of the best-selling Emotional Intelligence 2.0, offers valuable insight based on recent research from top universities on how successful people stay calm and focused under pressure. A moderate level of stress is good. Under limited, intermittent stress, the brain grows new memory cells and stays more alert. When stress is prolonged, however, decision-making skills and one’s physical health can be harmed.
Bradberry focuses on some of the best strategies successful, productive people employ to stay calm and clear-headed. A recent study indicates that simply being grateful, or appreciating what one has, improves mood and reduces the stress hormone cortisol significantly. Avoiding negative “what if” statements is another way to control stress.
“Calm people know that asking ‘what if’ will only take them to a place they don’t want or need to go,” writes Bradberry.
Taking time to disconnect is also healthy. Forcing oneself to “go off the grid” by avoiding technology, such as email and even the phone, for blocks of time is refreshing and mentally recharging. Avoiding negative self-talk is another big step. Bradberry recommends putting things into perspective by writing down specific things that are going wrong, as opposed to thinking in broad statements like “nothing is working.” Relying on a support system of people you trust by simply asking for help and talking about worries is a highly-effective stress outlet and strengthens relationships.