Trading is like treating an illness; if the cause is not found, no amount of medicine will be effective. Let's take a look at why most retail investors face endless losses!
1. Unable to Hold on to Trend Positions
Many investors adhere to the philosophy of "take the profit when it's there, secure the gains." If this is the last trade and they plan to leave the market completely, it's understandable. However, if they wish to continue investing, it is akin to expecting to sell at the highest point every time and perfectly time the bottom, which is an extremely low-probability event. The reality is often that after selling, the market continues to rise, leading them to miss out on subsequent profits, and they may even end up buying in at a high price and getting stuck.
2. Overly Pursuing Day Trading
Some believe that day trading is the pinnacle of trading, fantasizing that making one profitable trade will secure their financial future, and when funds are insufficient, they open contracts to profit. However, the reality is that this often causes them to miss out on major market movements that could lead to financial freedom, losing out on big opportunities due to incorrect profit-taking.
3. Holding on to Losing Positions and Averaging Down
When going in the wrong direction, they not only refuse to cut losses but also stubbornly hold on and average down. When they are right, they only earn meager profits, but when they are wrong, they endure bottomless losses.
4. Comparison of Gambler's Loss Theory
A gambler experiences losses equal to their winnings, whereas many retail investors face limitless losses and very few profits; over time, this will inevitably lead to total loss.
If retail investors want to change their investment predicament, they must overcome the above mistakes.
To truly achieve long-term stable profits, it is recommended to follow my approach to systematic investment (the best method, bar none), allowing you to enjoy the joy of victory!