I just saw an article that the private equity of the big shot Qingze has collapsed. I feel sentimental. I have been involved in trading for over ten years, and I have never written about my own trading experiences. So, I’ll write it down, for myself and for others.
Traders have a strong obsession, as trading may be the lowest barrier for ordinary people to access and the most likely path to cross social classes. A computer, a little money, and the rest depends entirely on skill.
1. Initially entering the stock market
I started trading A-shares in 2006, using the college tuition money my family gave me. Looking back, I was truly ignorant and fearless at that time. I was lucky to encounter a bull market, often hitting several limit-ups. I regretted that my position was too small and made tens of thousands of yuan; I felt incredibly proud and inflated. I still remember buying my first pair of NIKE sneakers for 1200 yuan with the money I earned, and taking my girlfriend to eat at a revolving restaurant. The next year, the stock market was bad again, and my funds shrank. I was afraid of losing all my money and decisively withdrew from the market. I realized it was the market that made me, not how strong my skills were.
2. Graduating and entering a forex company
In early 2009, as I was nearing graduation and had failed my postgraduate exam, the first employment direction I thought of was trading. I searched recruitment websites and found quite a few listings for 'trainee forex traders', 'trainee forex operators', 'forex trading assistants', 'trainee investment advisors', etc. The descriptions sounded grand, and I couldn't wait. Proudly, I believed that with my experience and insight, I could definitely carve a path in trading. Dressed neatly in a suit bought by my family, I went for an interview in Guangzhou. It was a grand office building with a huge trading hall filled with clocks from various time zones and screens displaying candlestick charts and news. The young men and women inside were all in professional attire, each in front of a computer, pointing and discussing the markets. This was my ideal trading company. I nervously went for my first interview, which was surprisingly simple, and I passed. They told me to start working next week. I returned to school excitedly, packed my things, and rented a place in Guangzhou.
The first week was training, with several hours of classes each day. An impressive-looking older man provided training for our group of newcomers. He claimed to have made a lot of money through trading, but what he taught was very basic. I felt somewhat inattentive, eager to get on the account and show off my skills. A woman gave us a simulated account, saying to start with simulations before moving to real trades. It made sense to me. In the second week, I performed well in the simulations, being the strongest among this batch of newcomers. There were about ten of us, most of whom had just graduated, but very few had a bachelor's degree; most were from vocational colleges or technical schools. I felt a sense of superiority but also wondered why the trading threshold was so low if I had studied.
In the fourth week, everyone was at a loss, confused. The company seemed to be waiting for us to consider our options. A young, seemingly responsible man came to talk with us one by one. When it was my turn, he said some profound words: 'Do you know Wall Street? The trading elites are there. If you can prove your real trading skills with a deposit, the company might let you go there. We also have a company there.' He continued, 'If you have financial difficulties, you can deposit a smaller amount, at least 10,000.' I was bewildered; I knew about Wall Street, but could I go there? Were you trying to fool me? Soon, some people began to leave the company. Damn it, I had already given you my tripartite agreement from school; what should I do now? I wanted to hold on, but I didn’t want to pay. This inner conflict kept me up at night. Others left, and some paid. I wandered in the trading hall until I heard a loud cry. I saw a man with many white hairs but looking relatively young, crying out. I didn’t understand at first, but others told me he was a former trading student who had paid but ended up as an 'investment advisor,' now calling friends and family every day to open accounts, his hair turned white from stress. After hearing this, I felt a chill; this wasn’t the life I wanted. The next day, I called the person who interviewed me and firmly submitted my resignation. I returned to the company, returned my ID, and left without wanting to stay even one more second. I didn’t receive a single penny in salary.
Okay, I admit I was scammed. My first job after graduation was at a scam company, a gambling platform, a seemingly high-end company located in a Grade A office building in Tianhe, Guangzhou. Fortunately, I didn’t pay the 'real trading fee' and wasn’t foolish enough.
3. Joining a U.S. stock company
I stayed in a shabby rented apartment in Guangzhou with classmates, wondering what to do next. Graduating meant being unemployed, and my life felt messed up. I searched for trading positions on recruitment websites, but they all seemed to be from 'scam companies.' Looking back, MD, it was only 2009, and computers had just started becoming popular; forex scam companies were everywhere. I was unwilling to give up, so I kept searching, continuously looking for related terms and posters. Positions like 'bond trader' and 'fixed income trader' all required work experience, and it seemed that legitimate trading positions wouldn’t hire fresh graduates... I thoroughly utilized recruitment websites like Zhaopin, 51job, and China Talent, tweaking my resume countless times, just wanting an interview opportunity, but none came.
I felt a bit desperate when my father called and told me about a '3D drawing' position at a shoe factory, which I could take without needing to know how to draw. Without a second thought, I rejected it. Months later, I finally got an interview call for a 'trainee U.S. stock trader'. By this time, I was well aware of the domestic trader recruitment market. Trading positions are not cultivated by legitimate companies; they only hire experienced individuals. The non-leveraged traders in banks have strict requirements regarding education and majors, often requiring campus recruitment. Only U.S. stock trading positions are willing to hire beginners because they work at night and finish the next morning, with a 12-hour time difference from us. The elimination rate is very high, and trading U.S. stocks is completely different from trading A-shares.
After successfully passing the interview, the routine was still training-simulations-summaries-real trading. However, I didn't have to bring in clients or deposit my own money; there was a basic salary of 1000. Everyone was genuinely trading instead of making phone calls. Newcomers generally passed the simulations because there were many channels for buying and selling U.S. stocks. Some channels even paid you when you bought. I had to memorize many shortcuts, practice hand speed, and engage in high-frequency trading, executing hundreds of trades in one night. After the simulation, I received $1,000 in real trading funds per month, with very strict risk control. If I wanted to increase my position after a loss, an alarm would go off immediately. Many colleagues made money by churning trades. One experienced trader worked at Citibank, code C. I still remember he placed large buy and sell orders of $400,000 at a one-cent fluctuation. If someone sold, he bought; if someone bought, he sold. The risk was very low; he didn’t rely on fluctuations to make money, but rather made profits from the commissions returned by the trading channels. There was another expert who earned $100,000 in one night trading non-farm payrolls. We few trainees stood behind him to watch him trade non-farm payrolls, feeling envious. This expert never traded late at night; he went home around 11 PM. He had that privilege.
I spent six months here without making money and was on the edge of elimination. I began to question my trading skills intensely, wondering about moving averages, Bollinger Bands, and whatnot. During that time, dozens of new people came and went, but among them, the best performer was a greasy-haired man with glasses and a high school diploma. When I left, he was earning $3,000 a month. Trading really has nothing to do with education. Among that batch, there was only one person I still keep in touch with; he is now a trader at Minmetals Futures.
After half a year in the job, I went from 130 pounds to 90 pounds, living a reversed day-night schedule. I rushed to catch the earliest subway back to my rented apartment, eating the cheapest meals, surviving on a 1000 salary and support from my parents. One weekend, after waking up, I became blind. I couldn't see anything. I was extremely frightened. After a few minutes, I could slowly see again. I had a high fever and walked alone to the nearby hospital. The doctor said, 'How did you come here by yourself with a fever over 40 degrees?' After getting an injection and sweating profusely, I thought a lot during the observation period. I gave up; I really couldn't hold on anymore. My body and mind were extremely exhausted, and most importantly, I saw no hope. My skills were just that; I was nothing and didn’t know how to improve. I submitted my resignation, and the company probably wanted me to leave long ago, without any retention effort. Sorry, I’m a failure.
4. Failed the postgraduate entrance exam for the second time, ten years in the workplace
Returning to the city where my parents live, I took a few months to recuperate. I didn’t know what to do, having graduated almost a year ago without any achievements. I decided to take the postgraduate entrance exam for the second time, aiming for a finance major at Southwest University of Finance and Economics. Those institutions like investment banks only hire graduates from 985 and 211 universities. Couldn’t I pass? I packed my bag and rented a room in Chengdu to prepare for the exam for a whole year. I went to Chengdu in February 2010 and took the exam in January 2011, only to... fail. Although I did well in the specialized subjects, my math was too poor. After all, how could a student like me qualify for graduate school?
I’m 24 years old now, but I have nothing. What is trading? I have already forgotten.
I went to Shenzhen looking for a job related to my major. After over ten interviews, all failed. Who would hire someone who graduated two years ago without relevant work experience? I felt my life was ruined due to constant failures. Fortunately, a fellow postgraduate student I met during the entrance exams introduced me to a small consulting company. I worked diligently, advancing to senior consultant within a year and project manager within two years. Then, I switched to an internet company, and six months later, I was promoted to regional manager in Zhejiang, even invited by Zhejiang University to give training lectures. I traveled to various cities in the country for projects and later switched to become a client-side manager. Now, in my thirties, I am the department head of a listed company.
I won't elaborate on this work experience as it is unrelated to trading, just being an ordinary employee, quite trivial.
5. The unshakeable trading
In 2018, life was pretty stable, with a house and a car. I suddenly thought of trading and started treating forex and gold as a side job, learning diligently. By this time, the internet had developed significantly, and I could find plenty of information online. Every day after work, I studied trading, starting with a small account and trading in real scenarios, reading articles, and gathering information. I can say I was a full-fledged learner online. Each time my underlying logic changed, I summarized a new system. If my underlying logic remained the same but only the details changed, I would iterate on the existing system. As of 2023, I have updated my system 36 times.
Since I chose to do it, I should do it well. However, I never expected that trading based on self-awareness would be so difficult, harder than scaling the sky.
Every system, I will review once to find problems, then conduct special research on each problem, fixing them one by one. If there are too many problems, I will gradually overturn my own system.
I stare at the market until late at night, having spent over twenty thousand hours in the past few years verifying the system with real trades. By 2022, I had lost over a million RMB. Most of the time, I lost a few hundred to a few thousand dollars per trade. Once, during a big fluctuation, I went all in with 10 lots repeatedly, losing twenty thousand dollars in one night. That night, my body felt numb, and my head buzzed. But I couldn’t let go; the time and money I invested were too significant. I could only persist, walking down the same path to the end, gradually becoming extremely sensitive to risk.
I collected information online, searching for 'experts' articles on various platforms like Zhihu, Xiaohongshu, Douyin, YouTube, and foreign websites, browsing public accounts, spending money on training courses, and consulting various so-called experts I encountered. The saying goes, 'To seek wealth and nobility, one must work hard.' Perhaps that’s the case, but does working hard really pay off? No, the idea that effort will yield returns is just a deception for the lower classes to work diligently. In the realm of trading, you won’t find that thread; it’s always futile work. Because the things you learn are essentially fake, the so-called experts you consult are not truly experts. What makes you think you can succeed? Deepening your understanding will only help you lose less but is not enough for stable profits.
As my understanding of trading deepened, I found that my learning process was a process of falsification. I discovered that 99% of trading books are useless, and 99% of so-called experts are fake, and they are all very expensive. I spent tens of thousands on systems and training, all of which were scams. What kind of industry is this? It's too deep.
Various 'experts'
Once again, I had a stroke of luck. As I often mingled in various trading groups, hoping to gain some insights, I finally met a true expert who provided me with guidance. I then realized I had never viewed trading from this angle before. I spent another year continuously testing, refining my underlying logic and supporting techniques. Understanding and skills are like the relationship between theoretical physics and applied physics, forming a derivative relationship. This is the saying 'there is a way without skill, skill can be sought; there is skill without a way, it stops at skill.' By 2023, I stabilized my trading, became confident, and often entered the market just as it exploded, achieving high win rates and high profits.
Therefore, based on my current understanding, I summarize the path of trading as 1 part luck and 9 parts sweat. Without that 1 part of luck, sweat is useless.
6. The demon of trading
Why do I say my trading path is the demon of trading?
On one hand, I've fallen into obsession multiple times on the trading path. I've often thought I had found the right way and, filled with joy and confidence, invested heavily, only to be harshly educated by the market. I lost hair, slapped myself, walked at midnight to think, felt my head swell, and then started over. My parents and wife were unsupportive, but I insisted on my path, firmly believing it could work. Many times I veered into detours, recalling times I frantically traded for rebates, or gained insights from MACD about the yin-yang, or derived the positive-negative N system from N-shaped trends combined with channels, or points, lines, and planes, or momentum and states. These paths have been too winding; without madness, trading cannot survive.
On the other hand, I found that most of my understanding has completely diverged from the mainstream trading perception. Sometimes, when I express some opinions in groups, I am often not tolerated by the 'righteous path'.
For instance, I believe:
- Retail investors using light positions are useless. Only after honing their skills can they use small accounts for heavy positions to turn things around. The so-called compounding in light positions is just wishful thinking.
- Speculation is speculation. Those who speculate play with human nature and anti-human nature. Talking about mindset is self-deception. All failures in execution stem from a lack of understanding. Those who win frequently naturally have a good mindset, but having a good mindset is useless without the necessary skills.
- Experts must have high win rates, at least not below 50%. The notion of low win rates with high profits does not hold. A low win rate indicates frequent wrong entries. Those who frequently enter incorrectly will also often exit incorrectly. What basis do they have to hold high-profit trades, and how can they exit high positions in a timely manner?
- What is the win-loss ratio? A good entry point results in a very small stop-loss, leading to a high win-loss ratio. A poor entry point results in a low win-loss ratio. Moreover, many people don’t even understand where the target and stop-loss points are, so how can they talk about win-loss ratios? Anyone who talks about fixed win-loss ratios is a scammer.
- Fibonacci, trend lines, and various indicators are all tools for cutting韭菜 (a slang term for exploiting retail investors). So many people study the golden ratio, but it is apparent that the golden ratio lacks underlying logic. Studying Fibonacci essentially indicates a lack of understanding of actual positions while imagining mathematical positions. (For example, the deer trend trading method.)
- The fundamentals are not what retail investors need to focus on; everything is reflected in the price. You only need to pay attention to how many stars the data release has. As for the specific content, previous values, and expectations, those are useless; analyzing them earnestly is just self-deception.
- The so-called 'only eat the fish body' means that the underlying logic cannot be short-term; it must be a big wave. Big waves require big stop-losses; otherwise, one cannot withstand it. Some people say, 'Then I can just trade with a small position.' This is called a light position in a trend, relying entirely on the inertia of big waves and larger spaces, using small positions just to bet on probabilities.
- Tell me, without a holy grail, do you think those who trade dozens or hundreds of lots really dare to do so? Long-term trading with dozens of lots must have a holy grail, high win rate, and confidence.
On the path of trading, I currently consider myself to have only achieved a minor success, with a win rate of 70-80%. I emphasize minimal stop-losses and have not yet reached the level of many experts who can easily trade dozens of lots for a profit of tens of thousands of dollars a day. Therefore, I can only share my current understanding; please do not criticize.
How should the path of trading be taken? A purely technical route to become a big trader? I hope to help you break the information gap with my understanding! Avoid unnecessary detours! Leave a 555! Follow the strategies of Tianyan!