The Pro’s Process - Derek Hernquist

The ninth in my series of posts asking Pro Traders about their psychological processes.  Delving a little into how it feels to them when trading.  The good and the bad.  How this has changed over time and what preparation they do mentally for performing as a trader.

One of the key features for me was that I wanted traders with experience who have been through the mill over the years and of course those who were kind enough to broach this subject publicly.  This I hope gives developing traders more to learn from.  

I’m very fortunate to have a great line up and this week is: 

Trader: Derek Hernquist

1) How long have you been trading?

I’ve been trading 20 years in one role or another

2) What style of trading / investing do you practice (technically driven, fundamental, systematic, a combination etc)?

I’m a technical trader, everything I do revolves around price and how people react to it

3) How do you feel when a trade goes against you?

I’m human, I feel better when I’m winning and worse when I’m losing. But trade planning based on 20 years of lessons supersedes any present feelings, so I always act on my trade blueprint. 

4) How do you feel when a trade goes for you?

It’s basically the same answer as for the last question, but, trade planning based on 20 years of lessons supersedes any fleeting moods, and my mood is best when I execute according to my plan regardless of outcome. 

5) How have these feelings changed over your trading career?  (Can you recall how you originally used to feel and elaborate on how this has changed over time?)

Unlike my early years, I spend zero time on questions like “why would anyone be buying or selling here?” There are all kinds of players with different motives and different timeframes, and when any of them combine it’s best to go with it or at least wait until the moment passes.

6) Do you have any practices that you do away from the trading screen to help you mentally and emotionally handle trading?

I play with my kids, that’s certainly a positive distraction. I love to read, I often just pop open a trading book and read a few pages to re-center myself. 

7) Have you always done this? 

I’ve always worked out to de-stress, even if just 30 minutes on an elliptical machine with a book. With so much online content, of late I’ll listen to an interview or book during a brisk walk after the market closes.

8) If not, how have you learnt to deal with the feelings that come up when trading?

Feelings are there, I no longer try to block them out. I do my best to use acknowledge them and use them to consider what others may be experiencing. I make written and verbal notes all day long, and review them each night.

9) Can you describe a time in your trading life which really rammed home the point that so much of trading comes down to psychological factors?

I don’t see how anyone can downplay the psychological and social aspect of markets. I embraced that belief fairly early but saw it manifest itself though the dot-com era watching pigs fly and smart people lose money on arbs like Long COMS/Short PALM. There were so many lessons to learn in such a short time, truly a gift.

10) If you could give aspiring traders one piece of advice about emotionally handling the market what would it be?

Find a mentor. As much as I love trading, I could have saved myself years of misdirection had I sought and found a successful mentor. I took timeless lessons about human behavior and eventually made them my own, but to have a teacher/coach helping set the path would have been a gift.


I’d like to thank Derek Hernquist for sharing about the way he tackles the market from an emotional / mental side of things and for his willingness to allow me to post this as a free resource in the hope that traders who have been in the market for less time or are thinking of entering can perhaps pick up some A-HA’s.

If you are interested in finding more out about Derek Hernquist you can find him:

On twitter: @derekhernquist 

At his website:


Previously in the series:

Charles Kirk - read it…

Matt Davio - read it…

David Blair - read it….here

Mike Bellafiore - read it….here

Mark Holstead - read it ….here

Brian Shannon - read it…. here

Mike Dever - read it…. here

Anthony Crudele - read it… here 


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Disclaimer: Embrace The Trend / Richard Chignell does not provide investment, financial or product advice.  I trade my own capital exclusively.  I eat my own cooking as should you.  If you are going to trade / invest it’s at your own risk and you must take responsibility for your actions.