I have been trading since 2011, and it has been more than a decade now. As I grow older, I find myself increasingly fond of looking back on the past, realizing that I have had different insights at each stage of trading.
These insights of mine are not unique nor profound, because for hundreds of years, most traders may have made the same mistakes and experienced the same pain as I have. What I have been through, others will continue to experience in the future.
The words I speak today come from the bottom of my heart, and many people may only resonate more deeply after experiencing it themselves.
My greatest insight is that I have made peace with myself.
When I first started trading, I liked to compete with the market, to argue over right and wrong. When I lost, I felt like I had lost, felt unwilling to accept it, and when I made a profit, I felt like the favored child of heaven, wanting to keep winning.
Before I started trading, I had heard many wealth myths and learned about many legendary traders from history. My goal at the time was to become one of them, believing that since I could do well in business in Africa despite the hardships, I definitely had the potential to excel in trading.
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But as time went on, with increasing losses, I knew I was making mistakes but still got carried away. I was angry at myself for not being strong enough, and with red eyes, I continued to trade, making more and more mistakes and losing more and more.
It was only when I had nothing left to lose that I truly accepted my defeat, being thoroughly tamed by the market.
Later on, I began to work on my techniques and trading systems, constantly trying and constantly starting over. Through repeated failures, my temperament was gradually smoothed out.
Originally, I was a hot-tempered young man in business, but after honing my trading skills, I truly became a mature and steady "adult." Because I know that impulsiveness is useless, and being anxious is useless. I know that if I want to pursue quick and huge profits, I have to bear the risk of a blown account, a risk I cannot afford, and I cannot stand the feeling of such failure, so I choose to be slow, steady, and ruthless.I am also aware that when my position is heavy, I become overly concerned about gains and losses, causing my heart to pound, so I strictly control my position size and lower my expectations for the rate of return.
I also understand that if the trading frequency is too high, I will be glued to the computer all day, not wanting to do anything else, staring at the market trends, and I won't be able to resist the urge to trade impulsively, even following the market trends to chase gains and cut losses. Therefore, I reduce the frequency of trading and opt for limit order trading, which allows me to occasionally check the market without being constantly attached to it. By maintaining a distance from the market trends, my entire world becomes much clearer.
Only after doing these things have I become increasingly "Buddhist-like" in my trading, where less is more, and more leads to confusion.
My trading has become smoother, simpler, and more comfortable. I no longer take things too seriously, nor do I compete with anyone or anything. I am no longer pursuing an extreme version of myself; I have made peace with who I am.
I know that there are things in this world that you can never obtain. I can only earn money within my capabilities. I cannot become a trading legend; I can only be a very ordinary professional trader, and I must calmly accept my ordinariness and mediocrity.
All beings are ignorant, having only likes and dislikes, without truth or reality.
This statement comes from the TV drama "The Way of Heaven." I recently watched this series again and was deeply moved by this line.
Is it really difficult to make money in trading? Or have you never had a clear understanding of this market?
Take the stock market as an example. Over the past seven or eight years, the market has been fluctuating widely around 3000 points. Using the simplest logic of buying low and selling high, by tracking some of the market's leading brokerage stocks or simply buying the CSI 300 ETF, as long as you open a position after the market breaks below 3000 points, there have been at least six or seven profitable opportunities in these seven or eight years.
In these seven or eight years, it is possible to achieve at least double the returns, as long as you are not greedy, do not disdain such opportunities as few, and do not disdain the long cycle. Such a level of returns has already surpassed the majority of fund managers on the market.This is the truth of trading: if one can maintain low desires, wait for opportunities, and seize them, everyone can make profits with very simple methods.
Why do most people still lose money in the stock market if it's so simple? It's because of the likes and dislikes inherent in human nature. People prefer quick results and dislike waiting; they like making money every day and dislike losses; they don't like enduring hardships.
Some individuals, upon seeing annualized returns of 20-30%, consider it too little and look down upon it because sometimes a single trading day with a stock limit up can yield a 10% profit. As a result, they enjoy chasing the market every day, buying high and selling low, only to find at the end of the year that they have lost a significant amount.
Sometimes, when they see an opportunity and want to bottom-fish, they are deterred by online news reports that warn of the high risks of bottom-fishing, as the market could continue to decline, causing them to hesitate and ultimately give up on entering the market.
The financial market is indeed vast, with numerous opportunities to make money, and everyone engages in trading for the purpose of profit. However, along the way, people tend to prioritize their personal likes and dislikes over making money, focusing only on satisfying their desires and forgetting that their original intention was to earn profits.
It is precisely because of this mindset that those who can see the truth have the opportunity to profit. Only by understanding the likes and dislikes of the masses can one see through the truth of trading.