From an onlooker’s point of view, it doesn’t matter if the position is burned, as long as the overall profit can be.
But people like “Mr. L,” who specializes in selling out and has a good sense of the trade, are realizing that a little restraint doesn’t hurt the bottom line.
01. Most of the people I have come into contact with can be classified into three categories: those who are from academic courses, those who get on the train midway, and those who are themselves from academic courses and get off the train again midway. I joke that they are “misinformed”.
“Mr. L” belongs to the second category. He majored in mechanical automation and has been trading for no less than eight years since his graduation.
In 2009, “Mr. L” started investing in stocks. He found it interesting to search the market for undervalued stocks to buy.
When it comes to making deals and investments, it can be said that he is quite bold and courageous.
“Mr. L” did not pay the tuition fee of the second year. He applied for a one-year probation without telling his family, and then used nearly 10,000 yuan to invest in the stock market.
He thinks that he did not tell his family because his rebellious period came late. After all, he was a good boy in the eyes of his family before college.
“The first time I bought stocks I made money, when I bought Daqin Railway.
Buy in autumn, because Daqin Railway is a special coal transport line, autumn and winter I will analyze from this logic.
I started buying in October and sold in the winter. I made about 20 percent.”
It is 2011 to move from stocks to foreign exchange.
When he was walking to the dormitory, “Mr. L” found a classmate of the same major playing foreign exchange and asked him to tell him about it. In addition to the fun, he felt it was cool to rely on this way to make money because of the characteristic of foreign exchange operating volatility according to news events.
“What’s the difference between investing in stocks and doing foreign exchange for you?”
“A lot is different. Foreign exchange moves faster.
Before the stock market cycle is relatively long, but just started to contact foreign exchange, do is super short, one night you can do a lot of single.
In addition, it is difficult for you to make more than 20 percent profit in the stock market, but it is very easy to do this in foreign exchange, it is easy to double, and it is very fast to get out of positions.”
Almost every trader can’t get over it.
Compared to his friend Dawn, who has never done it before (read his story here), “Mr. L” says he is a professional.
02. The first time professional warehouse burst occurred in the university. “Mr. L” participated in a simulated plate game on a British platform and won a weekly champion, with a solid prize of $3,000.
“Just done simulation disk, feel a little floating, feel very strong, solid disk account down after the start to do, about two days exploded.”
There are two reasons for the explosion.
One is that the position is very heavy, “Mr. L” according to the simulation of the disk method to do;
Second is the state of mind is not good, because in front of the simulation disk is smooth, I think I have talent, a hurry to make money.
“Mr. L” was losing money on tuition fees until 2016.
Repeated profit and loss, constant adjustment, for a free trader, is a great test.
You don’t know what basis to rely on to place an order. You don’t feel anything. You just keep negating your previous trades and rebuilding.
The process of setting up a trading system is time-consuming and laborious, which “Mr. L” thinks is the most difficult part of trading.
“I made money and didn’t know when to close my position.
Trading is not afraid to do wrong, the most frightening is that you do not know why to make money, do not know the logic of trading is what.
There was no thought. It was very confusing.”
A typical risk-taker, he has sold out at least 30 times so far.
He starts with $300 to $500, and it’s often multiplied a dozen times before it explodes.
It doesn’t seem like a lot in a single instance, but it doesn’t add up.
During that time, “Mr. L” was in the groping stage. Trading mainly depended on the fundamentals. He always thought that the floating losses of his account would explode and he would always come back.
Just like his wechat signature: radical speculator.
He likes to trade on the left, radical, not afraid to lose money.
“I’m not afraid to go backwards.
Usually do a strategy, batch approach.
Since I’m trading on the left side, I’m taking a loss.
Losses widen, will follow their strategy to do the opposite.
I don’t want to surrender, to deny the strategy, because it increases my losses and gives me a better entry position.”
Much of Mr L’s assertiveness stems from his confidence in his own strategy.
When it came to strategizing, he was well prepared.
First from the fundamentals, look at the recent market news, set the general direction.
Then look for opportunities from long periods, either daily or weekly, and relative highs and lows, including where the weekly or lunar lines diverge.
Combined with the fundamentals and technical to determine the big band, long or short.
The last thing to do is to stick to their own direction of operation.
“Even if it is a loss after the entry, as long as it does not deviate from my previous strategy, does not break the previous graph, you can do in this direction, and continue to add positions.”
03. It’s all strategy Strategy can make Mr. L money, but it’s also strategy that keeps him exploding.
Compared to before, the strategy of “Mr. L” now makes money.
He usually loses money during this gap, after one strategy is finished and before another is ready.
Without a prepared strategy, “Mr. L” couldn’t help himself from starting a new trade.
In fact, the position is not particularly heavy, if enough is enough, after a big pullback, he can turn things around.
Just such tough people, positions are usually relatively heavy, once the explosion of the warehouse, before the profit equivalent to a bamboo basket.
This is precisely the current status of his outbursts.
Knowing it was the same problem over and over again, why didn’t you take steps to avoid it?
“Mr. L” has reflected that it is difficult to overcome this shortcoming with his own character.
We all know that personality cannot be easily changed.
“Mr. L” further explained that a trader who has just experienced a successful trade is prone to let down his guard and become upset, assuming that the strategy has been very successful and then lowering his standards when making orders.
“It’s basically one word: Let your guard down, so I’ve been holding back on that this year and trying to do as little trading as possible until a new strategy comes out.”
“Mr. L” is a family businessman who owes about 3 million yuan in debt.
He once mentioned that the purpose of trading is to pay off the debt as soon as possible, realize the freedom of wealth, so as to enjoy their own life.
I tried to derive his trading style from his purpose, to capture a connection between the two.
“I don’t think it has much impact on the mentality, just the sense of urgency, and it does have something to do with rushing in before the strategy is finished.”
The two months between October and November 2018 were his most impressive up-and-down period.
These two months of continuous yield more than 40 times, but still ended in a burst.
Since September, “Mr. L” began to short American stocks with thousands of dollars, and he exploded his position 3 or 4 times. But he did not take any action, just waiting for the turning point.
On October 3, when the stock market hit a record high, there was only $1,000 left in the account.
“Mr. L” sensed that it was no. 3 or No. 4, and that the long-awaited opportunity was about to present itself.
“A friend of mine was trading with me and he was giving up and wanted to cut his losses and quit.
I said never give up, in two days, the market will turn around.
If you ask me why, I can’t tell.”
Can not say clearly behind, on the one hand, because he found that the market was inexplicable rise, on the other hand, in fact, there is still information support.
Economic data in the third and fourth quarters of 2018 were poor, and during the period when U.S. stocks hit new highs, there was no tailwind, such as crude oil.
“Mr. L” has experienced this many times. When a technical indicator fails, the market will ignore it. Even if it keeps going up, it will quickly reverse when there is a correction.
Things went as “Mr. L” thought. The US stock market fell that night. By November, his account had reached 40,000 US dollars, including the intermediate deposit, and the return rate reached 40 times during that period.
Unfortunately, when I caught the news of Sinopec, “Mr. L” was also long crude oil. I didn’t see much in the account of American stocks for two days, and finally the account was closed, with only tens of dollars left. After the closing, “I lost more than 70,000 dollars by adding one piece.
The next day, for my girlfriend’s birthday, I got up and made a mousse cake.
I was doing well before the warehouse burst. I thought I’d give her some money to buy her a car. When the car is gone, I’ll make a cake.”
05. Dawn sometimes argued with “Mr. L” about trading views, but very much recognized “Mr. L”‘s sense of trading.
Disk sense this kind of thing, in fact, very mysterious.
Like the big ups and downs in 2018, “Mr. L” in the market forecast, there is really something unexplicable.
“Mr. L” often uses this feeling in other transactions, and Dawn has benefited from it.
In July this year, gold rose to over 1450 and then retreated, but silver started slowly, reaching $15, stopped rising and began to retreat.
“Mr. L” concluded that this is the characteristic of gold and silver.
When the band market rose, gold started, silver slightly slower.
In the second phase, gold will fall back and silver will take gold up.
“Mr. L” and Dawn argue for nearly two hours about seeing more blank silver.
According to Dawn’s disciplined personality and his system, silver is not following the system, so he will not go long silver.
Interestingly, Mr. L, who is more of a feeler, also trusts his own feelings on a systematic basis, so Mr. L thinks silver will rise with gold in less than two weeks.
“I said I could not move him, he felt silver weekly line monthly line too much pressure, simply can not get up.
I said silver is this urine, no matter how much pressure, but once you think about it, a bright line can be pulled up, unlike gold and US stocks slowly up.
I’ve been through this kind of movement a lot of times, and it’s just the pattern that makes me feel this way. Silver was gathering momentum.”
The argument ended with Dawn’s submission, and silver quickly rose to $16 or $17. By $19, it was already strong.
“Mr. L” thinks Dawn is exaggerating. After all, there are many times when he loses money. He can only say that from the perspective of probability, he is more likely to be right.
“I think it’s more accurate to say that sensitivity to information is one of my characteristics.
It’s a double-edged sword. No matter how often you’re right, if you’re wrong once, you’re back to where you were.”
When I worked in Zhengzhou before, “Mr. L” had a trading circle of 8 people. Until now, Dawn is the only one who keeps in touch with him.
Trading compared to other industries, he thinks the elimination rate is higher, only through the first few years of time, there is a chance to go easier.
“I think in this business, the leftovers are king.”
In this market, “Mr. L” has a deeper understanding of human nature and is more likely to recognize himself.
“I have a very casual view of life. Since one life is irreversible, don’t care too much about other people’s opinions.”
Since June, his account has increased another 20 times.
I admire his attitude towards life and look forward to further improvement in his dealings.
For example, less exposure, more correct trades, so that he will move further away from debt and closer to financial freedom.
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