In the world of trading, there is a problem known as 'original sin,' which is the greed inherent in human nature. Almost everyone who enters the trading field has been taught how to analyze the market and identify candlestick charts, yet few have been taught how to face and manage their inner greed. This gap often leads traders to be continuously disturbed by the risks brought by greed throughout their careers, learning to cope with it only through long-term self-reflection.
The real problem of greed in trading lies in the incorrect path or method of fulfilling that greed, which stems from 'mismatch'—the disparity between personal desires and one’s own capabilities. For instance, when a trader hopes to achieve profits through a certain trading method, but the feedback from the market does not align with their expectations, this mismatch triggers greed and brings enormous risks.
A typical example is a trader who trades under the guidance of a company supervisor. This supervisor employs subjective judgment and a grid trading strategy, which may be profitable in a market without a clear trend but will incur losses in a one-sided downward market. During a market crash, the supervisor not only used their own account but also tapped into the entire company’s margin to average down, ultimately leading to the liquidation of the company’s accounts, dissolution of the company, and personal bankruptcy for the supervisor. This case clearly illustrates the consequences of greed: when an individual's desires (hoping to profit through grid trading) misalign with market realities (a one-sided downward trend), greed can lead to disastrous results.
This greed also manifests in traders' misconceptions about trading methods. For example, the fate of grid trading is trend-dependent; if traders do not recognize this and instead expect to achieve stable long-term profits through grid trading, it represents a manifestation of greed. This greed arises from ignorance or misunderstanding of trading methods.
To avoid the risks brought by this greed, traders need to deeply understand the essence of trading methods and recognize the limits of their capabilities. As mentioned in the text, achieving an understanding from zero to eighty percent may take only five months, but moving from eighty to ninety percent may require five to six months, while progressing from ninety to ninety-five percent may take a year, and from ninety-five to ninety-eight percent may take three to four years. This depth of understanding is key to avoiding greed.
Moreover, greed is also reflected in traders' expectations of copy trading. Many traders hope to profit easily through copying trades but often overlook the risks involved. The success of copy trading is not accidental; it requires a deep understanding of the trader's profit model. If traders merely follow others blindly without understanding the essence of trading, they may see profits in the short term but are unlikely to sustain profits in the long run.
In trading, greed is inevitable, but it can be managed with the right approach. Traders need to recognize that greed itself is not the problem; the issue lies in whether the path to fulfilling that greed is correct. By deeply understanding trading methods, evaluating their own capabilities, and maintaining caution in decision-making, traders can reduce the erosion of greed on their finances and achieve success in trading.