Wei Zi spread

Perhaps the success of the capital market is different from that of other fields. What kind of investment concept should be formed? What is the essence of trading? As a trader, what is your trading belief?

With the capital market, mankind will have an invisible and cruel battlefield of interests, and various theories on how to fight on this battlefield have emerged, including academic school, basic analysis school, technical analysis school, and fringe schools such as chaos theory, astrology theory and Zhouyi gossip. Wait, wait. I respect and have been addicted to these theories, but as a real market trader, now I pay more attention to the interpretation and perception of the market language itself.

Why are so many people addicted to the capital market? Are they all seduced by money? Don't! Subconsciously intoxicated with human "gambling" instinct is also an important reason why many people stay in the market. The characteristics of "gambling" such as the pursuit of excitement, fear of boredom, blind self-confidence, repeated losses and repeated wars are human nature, and the "chaos in the daytime" that fluctuates almost every day does provide many seemingly "action" and "profit" opportunities. Therefore, subject to instinctive gambling, many traders just put their energy and enthusiasm on the luck of hoping to make a quick profit. Observe the market calmly and determine how to establish the market.

No wonder trading guru Williams said, "I am far more interested in the art of trading than the recent one or two transactions themselves."

Perception 1

Jesse, the big speculator on Wall Street? Livermore once said a thought-provoking sentence: "The difference between gambling and speculation is that the former bets on the fluctuation of the market, while the latter waits for the inevitable rise and fall of the market. Gambling in the market will go bankrupt sooner or later. " Many years ago, I posted this sentence on the computer to trade! In the market, the most common problem we encounter is "where can we go up" or "where can we go down". These questions may be casually asked or seriously sought after, but they often actually strengthen some of our thinking, that is, what will the future of the market be like? How to predict or guess the future? In real life, people who are eager to ask such questions are like crossing a river. We often hear that people are proud of the correct guess in the market. This is a very normal and understandable thinking. In order to explore and guess the mystery of the future trend of the market, I also speculate on the future operation of the market from time to time. I have also studied various macroeconomic forecasts, from the Book of Changes to Chaos Theory and Neural Network, from Astrology Hypothesis and Cycle Hypothesis to Wave Theory and Gann Theory, and even the orthodox Macroeconomic Forecast.

Of course, this knowledge is helpful and enlightening to guess the direction of the market, but as a professional speculator, he has long since stopped focusing on such issues. What a professional speculator should do is to "identify different market conditions, make different trading plans according to different market conditions, and execute trading plans with strict discipline". Because, aside from the philosophical proposition of whether human beings have the ability to accurately predict the future (Dow's theory holds that "the disorder in the daytime" is unpredictable), the latter thinking method will make us consider the market and transactions more comprehensively in terms of these important factors of successful investment, such as "risk management and psychological control".

From my own trading practice, if I run the trading according to the former thinking, my investment performance may fluctuate greatly, while trading under the guidance of the latter thinking method can make me make money continuously and stably.

Perception 2

I often tell myself that a professional speculator must be brave and decisive when the market is good, and be cautious when the market is bad. Reckless and timid should not be people.

Predicting the future is the dream of human beings for thousands of years, and predicting the market is the natural desire of investors. After mastering certain analytical methods and skills and having certain market intuition and feelings,

We can predict the trend of the market to a certain extent, but from my personal market experience, it is much more important for professional speculators to "do the right things in different environments" if they want to make money continuously and stably. In other words, "identify different market conditions, make different trading plans according to different market conditions, and execute trading plans with strict discipline" is a much more important job. There are many correct investment methods, but the correct thinking methods should be basically the same. Many investors spend too much time on the former and seldom consider the more essential latter!

I have met many successful investors. Although they have different styles, they have one thing in common, that is, they all have the psychological characteristics of "being calm when important things happen" and "advancing and retreating according to evidence". Perhaps the success of the capital market is different from that of other fields. What kind of investment concept should be formed? What is the essence of trading? As a trader, what is your trading belief?

Yes, just as people are thinking and acting according to their own beliefs, investors are trading according to their own beliefs in love and hate.

They often enjoy the profit joy brought by their respective beliefs, and at the same time they often encounter the failure confusion brought by their respective beliefs.

Perception 3

We can't help asking, what kind of trading belief can make our funds grow steadily in the speculative market? The answer will of course vary from person to person. As a professional speculator, my answer is: give up any belief of myself and follow the belief of the market; Give up any personal will and follow the will of the market; Give up any theories, concepts and skills, and formulate phased trading strategies and trading strategies according to the actual situation of the market.

Follow the faith of the market; According to the actual situation of the market, the trading strategy is determined by stages, and the trading is carried out accordingly. Just like driving a car, everything depends on the road conditions and the current traffic conditions, and there is little subjective prejudice or transcendental theory;

Another example is the behavior of water, or a gurgling stream, or a dripping stone, or a quiet lake, or a rushing river, or a vast sea, all of which are peaceful and comfortable according to their own specific conditions.

Adam Smith said: "When we are in a certain paradigm, it is hard to imagine any other paradigm", and the sixth ancestor of Zen said: "Out of phase is Zen, and chaos is determined".

For market transactions, if I want to pursue stable capital growth, my experience is: give up all subjective prejudices or hopes, don't want what I want, and keep my mind and thinking flexible.

Understand the market situation and market structure through market language, listen to what the market needs, adjust its internal structure, and integrate it with the internal structure of the market.

If there is a problem you can't solve in the whole process, give it up instead of trying to solve it by force. In this way, the benefits of money will not be the only return.

Newcomers to the market will inevitably be dazzled by all kinds of data and information in the market, and after several years of experience, they will be confused by complicated analytical methods and operational schools.

After experiencing similar operating experiences and puzzles again and again, people are still diligently learning various methods and are keen to chase every possible profit in the market.

This is partly because of the drive and temptation of profit possibility, and partly because of human nature of exploration and instinct of pursuing perfection.

Of course, this will undoubtedly have some benefits. However, "one step forward in truth is fallacy" and "although it is a slight difference, it is a thousand miles away", but it is easy to fall into a dead end of thinking if you go along this road.

This is because, just as human beings can't explore all the mysteries of the world, corresponding to the market, we are doomed to fail to capture every profit of the market.

This is the law of philosophy or the arrangement of "God". Newton's exploration of "cosmic theology" in his later years achieved nothing, and Einstein's research on "unified field theory" did not achieve much.

So, are we going to fall into agnosticism and stop exploring the market? Must we be indifferent to the market?

Obviously not. Because people are spiritual. My thinking is: "Simplify, simplify, simplify again" may be one of the good ways.

Perception 4

Most of the masters are simplified: although Gann established a complex market measurement system, in his last book, 45 years of Wall Street, he really recommended his concise more than ten operating rules;

As we all know, Buffett simplifies to give up the quotation machine, even macro analysis and even industry analysis, and only pays attention to the "intrinsic value" of the enterprise; Soros's "reflection theory" only puts on a gorgeous coat on the thorough understanding of the basic factors of the market and the superb grasp of speculative psychology, but its essence is brief; Anyone who knows Peter Lynch's common-sense investment methods will be amazed at the simplicity of a generation of masters. "In order to study worse and worse, in order to make the road worse and worse", "The road is simple and the sound is great." Giving up the blind and arrogant nature of human beings, acknowledging their own limitations, not pursuing profit opportunities that the market does not belong to them, and doing what they can, "simplify, simplify and simplify again", should be the way to survive and win.

What is the purpose of the transaction? Of course, continue to make money steadily! However, when we carefully observe the trading behavior of investors, we can easily find that their trading behavior has been "alienated" and they have lost their original purpose!

People have complete sex and incomplete hate. Please try. If you draw a circle with your hand and leave a gap, you will feel a little uncomfortable if you don't completely fill the gap. This subjective desire for perfection may constitute part of the motivation for people to pursue their own goals, but sometimes, the thinking of "wanting less" may actually make us achieve our goals more smoothly and let us survive better.

Is it because I don't love the "full moon" anymore? No, I just learned that in the real world, it is more frequent to spend a full moon. Even, I found that in the traditional culture of China, "lack" is simply a beautiful realm. The beautiful myth of "Goddess mending the sky" born from "lack of heaven and earth", the literati talking about "seeking food for lack" and the ingenious "seeking pavilions for lack" in the history of ancient buildings in China ... fascinated me and made me realize. "Lack" is an organic part of China's ancient character, and I like the realm of "lack". The thinking of "insufficient" makes us closer to reality and farther away from fantasy.

As a professional speculator, I gradually found that in market transactions, we should also make good use of the thinking of "seeking deficiency" and give up the concept of "seeking perfection".

If you make good use of "thinking is not enough", how can you blindly chase up and kill down in the big day trading, but go further?

Make good use of "thinking for lack", how can you be reluctant to sell the highest price and finally be quilted?

Make good use of "thinking for lack", how can you risk huge market risks to chase a darker "dark horse"?

..... More importantly, if you make good use of the "thinking of seeking deficiency", you can also save a lot of inevitable troubles in the trading process and make your thinking clearer and more concise.

Will not be confused by the complicated market conditions, market transactions are no longer a simple money-making tool, but begin to become a kind of enjoyment and fun.

Feeling five

True perfection only exists in ideas. No one in the world has really seen something round: Is the moon really round?

In fact, a coin is not round enough, even if the circle made by high-tech technology is observed with a high-power microscope, it cannot be perfect.

No wonder Zeng Guofan said, "... I dare not seek perfection, but the villain always seeks perfection, and the whole person has it, while the mean and fierce people come one after another, and everyone is often short of it, while one person always seeks perfection, which is unfair. ”……"。

Then, let's begin to appreciate imperfections while loving perfection, because we love the full moon and let's love the lack of it-they are the same month!

So, is there a moment in life that is not perfect? At which moment should I not worship, be grateful, or be thankful?

What is the most essential requirement for successful speculation? Various investment theories and countless investment books all give their own answers. I used to be addicted to these theories and books, trying to find the "golden finger" given by God, but all I got in the end were gray and pale theories.

I also asked the president of a world-renowned international fund management company in Asia face to face, and all I got was his answer.

Thanks to long-term practice, tempering and baptism, with the change from stumbling to making money steadily, I gradually have my own feelings, beliefs and answers: "strategically follow the market psychology and tactically go against it." Strategically following market psychology enables us to seize some strategic opportunities, avoid some big risks, make our overall thinking clearer, and make the overall layout of our transactions more reasonable; Tactically against the market psychology, we can grasp more trading opportunities, make our transactions more detailed, and make our understanding of the market more profound and subtle.

The former is the concept and premise of winning, and the latter is the specific path to turn this concept into real profit. The two complement each other, which will make us invincible in the market and make money continuously and steadily;

The former is an inviolable precept for any trader, while the latter requires users to achieve the realm of "winning by doing nothing" through the combination with the market.

Feeling six

A real market expert must not stick to any skills, nor be superstitious about policies, theories, technologies and news. What they pursue is a superb grasp of the psychology of market groups and a complete understanding of their own individual minds. Throw away the shackles, you can be chic!

Because they lost their original purpose, some investors consciously or unconsciously alienated their trading behavior into "scientific research". More than once, I have heard some "experts" brag about their perfect deals, such as how to buy at the lowest price and sell at the highest price. But when I talked with them deeply, I found that they were intoxicated in a game of research and prediction. They either sum up some "laws" according to the historical phenomenon of the market, or speculate on the further trend changes of the market according to some theory. They forget that in order to achieve the real goal of making money continuously and stably, the more important work should be because the effectiveness of the "model" or the adaptability of the "theory" will change with the change of market conditions, and the identification of market conditions and the formulation of strategies are eternal.

Some investors consciously or unconsciously alienated their trading behavior into "winning the lottery" because they forgot the original goal of their trading. As long as there is a little hope, they are completely desperate to rush in and completely forget the word corresponding to profit, risk!

Because of the purpose of making money continuously and steadily, I often don't seriously evaluate the risk-return ratio of my own transactions.

Once entering the market, people want to make a profit and do something, but in order to do something faster, people often choose to keep acting, acting and acting again.

I casually opened the recent professional securities newspapers and periodicals, such as "how to choose strong stocks in adjusting the market" and "adjusting stock selection with investment passion for the market" and other articles full of tempting titles can be seen from time to time;

I believe that when the TV financial channel is turned on, seemingly attractive noises such as "abandoning the market and speculating in individual stocks" can be seen everywhere. As we all know, this kind of thinking caters to some instinctive elements in human nature (because people are always easy to believe what they like to believe), but what we see more often in the market is that many people actually take a longer way to take shortcuts and trade according to this idea.

Doing more is not necessarily good, and sometimes doing nothing may be the best choice.

Not to mention the old adage "Do something and don't do something", "Be both civil and military, and relax one by one", and the true story of "Silence is better than silence" that often happens. Even Edwin Riffer, an early successful speculator on Wall Street, said: "Blind and frequent trading is the main reason for the losses of Wall Street investors, even among professional investors.

But I have to make the right choice. I can't make a move, so I just wait … "He added," The secret of making a lot of money is that I often just sit quietly … ".

Too much action is blind action, which will consume our spirit, make our minds hallucinate and consume our money.

Because blindness mainly comes from psychological blind spots, the way to reduce blindness is mainly to adjust psychological blind spots. To sum up, there are roughly three:

First of all, we should adjust our views on action. Doing more does not necessarily mean diligence, and doing more does not necessarily enable us to achieve our goals faster. Sometimes, doing nothing is a better state of being.

The second is to adjust the attitude towards opportunities. People often think that they should seize opportunities as much as possible, but in the eyes of professional speculators, they are more concerned with "only grasping the opportunities that they can seize and only grasping the opportunities that are big for themselves";

The third is to learn to enjoy loneliness. Many actions are only made by people who are afraid of boredom. "Doing nothing is boring" is actually an unhealthy mental state.

The rushing river is a kind of beauty, and so is the quiet lake. The differences between them are caused by the different environments that produce them.

It is the basic quality requirement of professional speculators to act according to the objective environment rather than psychological blind spots, often without making any transactions and quietly feeling the market.

Feeling seven

A real market expert must not stick to any skills, nor be superstitious about policies, theories, technologies and news. What they pursue is a superb grasp of the psychology of market groups and a complete understanding of their own individual minds. Throw away the shackles, you can be chic! In the speculative market, the most important, most easily overlooked and most difficult thing to really do is "trading discipline"!

Why is "trading discipline" the most important? Because "trading discipline" is the basic guarantee for survival in the market:

For traders, "trading discipline" is like the brakes of cars, the parachutes of pilots, and the lifeboats of ships. You can control risks and save your life at critical moments. For traders, "trading discipline" is also a real supervisor, which allows you to strictly implement your trading plan and not be confused by the dazzling "daytime clutter" in intraday trading. Why is "trading discipline" the most easily overlooked? This is a psychological misunderstanding caused by the superficial characteristics of spread income:

The premise of obtaining the spread income is the consistency between the position direction and the price trend. Therefore, people certainly think that the prediction of future price trend is the most important or even the only link in the transaction, and people naturally pay most or even all attention to the prediction of future price trend. As we all know, prediction can only be a game of probability in essence, and excellent prediction can really greatly improve the odds. However, I have indeed seen traders who predicted correctly nine times out of ten trades and ended up losing money. The reason for their losses is that there is no "trading discipline" to control the operational risk of loss-making transactions. We often see people who "speak well but do badly". Mainly, problems such as "trading psychology" including "trading discipline" have not been completely solved.

Why is "trading discipline" the most difficult to achieve? Because "transaction discipline" often contradicts human nature: it is human nature to pursue personal subjective will and act according to personal feelings without being bound; Subconsciously, it is human nature to think that an individual's intelligence can do things that others can't do, can do things that are punitive to others, or always take chances with his own trading behavior. The "ostrich mentality" that only considers the good side and instinctively refuses to admit and investigate the bad side can really make people feel happy or anesthetized; Some random characteristics of short-term market fluctuations make the implementation of "trading discipline" seem to have lost some superficial phenomena of "market opportunities", which is really enough to confuse people and even "regret". As we all know, "trading discipline" is the most important magic weapon for traders.