Can Meditation Make You a Better Investor? – InsideHook

New evidence suggests that stock traders might benefit from regular meditation.

Carol M. Highsmith/Library of Congress

Certain things just don’t seem to fit together, like floor wax and dessert toppings. Stock trading and meditation would seem to be another inherently dissonant pair. One is a high-stakes, high-energy activity focused on making money; another is about calmness, serenity and a journey into the inner self.

And yet the two might not be quite as far apart as you might think. A new article by Nick Ravo at The Wall Street Journal unearths a surprising piece of information: new evidence suggests that meditation might just make stock traders better at their jobs. And some statistics indicate that plenty of people in the industry are already engaging in meditation, including 16 percent of the members of the CFA Institute.

But can it improve your performance? Ravo’s article cites some studies that suggest it can:

A few small studies, direct and indirect, posit a positive link between meditation and trading gains. The most convincing research was published in 2018 in a Thai interdisciplinary journal, the Thammasat Review. The study collected data from 226 retail and professional traders, and found that those who meditated intensely ran portfolios that gained more than those run by traders who didn’t meditate or meditated less intensely.

This isn’t a definitive answer, though; other studies offer evidence that indicates other answers to this question. That said, in a high-stress job, something that might reduce stress sounds deeply welcome. Could a host of meditating stock traders ultimately push the industry in ways that go beyond questions of profit and shareholder value?  If nothing else, it would be a fascinating twist for the industry.

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