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- After a stressful few years for stocks, traders are flooding the offices of therapists and mental health professionals.
- Trading is always somewhat stressful, but intense losses in 2022 made it even worse, traders say.
- Wall Street is seeing elevated rates of depression, anxiety, and substance abuse, psychologists told Insider.
Megan, a full-time trader based in California, was one of the many investors who saw their portfolio struggling in 2022, the year markets were upended by a historic campaign of monetary policy tightening that drove the S&P 500 down 20% for its worst performance since 2008.
A perfectionist, Megan's losses bothered her deeply. When she was at her most stressed, she wanted to spend 14-16 hours a day in front of her computer before she finally sought help with a trading psychologist to help manage her emotions.
"If you're losing money or struggling, I mean you think about it whether it's morning, afternoon, or at night. It's just one of those things that pops in your head," Megan told Insider. "You want to stare at your screen and try to fix whatever's going on and make the money back."
Her story runs parallel to other full-time traders, either day traders or Wall Street professionals, who have begun flooding the offices of therapists, psychologists, and other mental healthcare providers to sort out feelings of stress after a rollercoaster few years for the stock market.
Those in the field say clients who are involved in trading are reporting higher rates of depression, anxiety, and relationship problems partly as a result of their losses and the whiplash of highly volatile markets.
That even applies to professional Wall Street traders, who already work grueling hours in cutthroat environments. The pressure has gotten worse over the last year, some staffers say, as big banks struggle to keep raking in their pandemic-era profits.
A survey of more than 600 bankers taken by Wall Street Oasis this year shows that on a scale of 1-10, banking professionals on average rated their mental health as a 7.8 before starting their jobs, though that deteriorated to 5.6 after they went into banking. Meanwhile, 32% of trading professionals said they had at least considered therapy or mental health services due to stress at work.
That's because their jobs are intrinsically tied to how easy or hard it is to make money in markets, and it's become a lot harder to post big gains since the dizzying climb stocks enjoyed in the early years of the pandemic. Fears over job security are on the rise as banks look to cut costs by trimming headcount.
Goldman Sachs axed more than 3,000 employees at the start of the year, around 6.5% of the investment bank's global staff. Bank of America, meanwhile, said it slashed 1,000 employees over the first quarter, and planned to layoff as many as 4,000 workers by the end of the first-half.
"With the current macroeconomic situation they started to care less," one unnamed Bank of America analyst said of workplace culture in the report. "We passed from being a group with a decent culture to one of the worst teams of the bank."
"Absolutely toxic miserable sweatshop," one Stifel analyst said. "I hope things change for the better but I know because of the churn and burn mentality they definitely won't."
Dr. Greg Kushnick, a psychologist based in New York's Financial District who has a roster full of clients who work on Wall Street, says he's seen referrals to his practice increase about 20% each year since the pandemic, which is when he thinks the rush of stressed out banking professionals turning to therapy began.
Dr. Reid Daitzman, a Connecticut psychologist who frequently works with day traders, says interest in his practice has gone up about 10-fold over the same time frame.
The fallout
Kushnick has observed some worrying trends among clients who seem to be buckling under the high-stress nature of trading.
More patients have reported feelings of anxiety and stress, particularly as fears of layoffs rises. In some patients, the stress has taken a toll on their physical health, contributing to conditions like high blood pressure or gastrointestinal issues.
He's also noticed a higher incidence of substance abuse, including alcoholism, drug use, and gambling addiction among his clients. Finance was among the top three industries with the highest increase in positive drug testing over the past five years, according to data from Quest Diagnostics, with positive results in the finance and insurance sector rising 38.5% since 2018.
Some of Kushnick's clients also report relationship stress and say they've considered splitting with partners, partly because of the growing pressures of their Wall Street jobs.
"I think it's getting worse," Kushnick said of his patients' mental health. "People are getting more depressed and more anxious … There were just so many broken relationships, broken marriages," he added of the pandemic years.
Créde Sheehy-Kelly, a trading psychologist who worked with Megan to manage her stress levels, says these trends aren't new, but they have gotten worse in recent years as volatility in the stock market has become more extreme.
Kushnick says he tries to teach his patients a number of skills to cope with the stock market's ups and downs. One of them is not taking out the stress of a bad day on a loved one at home. Another is instilling more of what he calls a sense of "hardiness" in his patients.
"It's this sense … that they can cope with an unknown future, that no matter what happens, they will be okay. Because people will develop a sense that a catastrophe will occur if the stock market crumbles or if they lose their job. It's building a sense of resilience so they can manage the uncertainty," he said.