Short-term trading, especially day trading, carries significant risks, primarily because price fluctuations in the short term are mainly random, which makes it challenging to gain a sustained advantage through judgment.
Of course, some quantitative trading strategies involve advanced mathematics and algorithms, which differ from subjective human trading.
What I refer to are trading methods that rely on personal judgment; many people dream of making substantial profits through short-term operations, but they often find that they are moving further away from breaking even. This is evident when observing how many people get lost in short-term trading.
Of course, there are also lucky individuals who can pull back at the right moment, but that is merely an exception.
For those with limited capital who wish to earn more, they might consider trying trend-following strategies.
This approach does not require excessive anxiety; perhaps good returns can be seen in a year or two, and it allows for long-term holding.
On one hand, long-term holding, compared to frequent short-term operations, does not overly drain your energy and does not cause significant disruption to your life.
On the other hand, the core of trend-following lies in identifying a genuine long-term trend. In recent years, the global economy has been weak, and geopolitical conflicts have intensified, reflecting that we have entered the latter stage of the economic cycle.
Therefore, in the next phase, as the fundamentals continue to deteriorate, such phenomena will become more prevalent.
