1. Gambler Type
If you win, you'll enjoy the company of young models; if you lose, you'll have to go back to work. Each of us is a gambler because gambling is human nature. Throughout human history, no matter how much suppression is faced, the strong demand for gambling has never changed.
While the cryptocurrency circle is not exactly like a casino, it must be acknowledged that the speculative methods of most people in the cryptocurrency space are essentially no different from gambling. Losing money is always a result of winning money; after unexpectedly gaining profits initially, gamblers become overconfident. After facing a setback, they attempt to recover their losses, increasing their bets without care in an effort to regain their initial capital.
Wanting to win more after winning, wanting to recover losses after losing, waiting for rebounds while being trapped, fearing missing out, chasing highs and cutting lows, all of these are characteristics of a gambler's mentality. They set a virtual imagined goal in their minds, completely ignoring the current market trends, acting according to their greed, fear, and hopes. Why is it sometimes that fortune-telling is so accurate? Because what determines a person's so-called 'destiny' is habit, is the inertia of behavior, is karma. Karma forms the cause of an event and also the effect of an event; karma is also the process from cause to effect. The moment you enter the market with a gambler's mentality (cause), you are already ensnared by the web of karma, and therefore a tragic ending (effect) is already predetermined.
2. Stubborn Mule Type
Hold on tight; the team is working. The most typical behavior of a stubborn mule is to stubbornly cling on, especially in the face of huge losses during a market crash. Small fears cause panic, while big fears lead to paralysis; the bigger the drop, the more they cling. For example, a friend in my group faced a massive drop and failed to cut losses in time, resulting in a liquidation of assets worth millions. I was curious and asked why he didn't cut losses in time, and he said that after seeing such a huge loss, his mind went blank, and he was completely frozen.
People tend to have a stronger emotional reaction to the outcomes resulting from taking action than to those resulting from inaction. Therefore, people often choose 'not to take action' out of fear of regret. What if I sell now and the price rebounds? I would regret it even more, so I stubbornly hold on. Another type of behavior is that position size determines mindset; getting emotionally attached to a project means that after buying a certain cryptocurrency, one automatically blocks out negative news and changes in market trends about the project. They refuse to listen to any advice and selectively search for information that supports their so-called correctness and truth.
Is the market afraid of your stubbornness? The main players actually like you stubborn mules.
3. Get-Rich-Quick Type
It is undeniable that the vast majority of people enter the cryptocurrency space attracted by the wealth effect, including myself. There is nothing wrong with getting rich; who doesn't want to achieve class mobility through investment? What truly harms is the fantasy of wanting to change one's fate through getting rich, and market returns are not obtained through mere imagination. Overemphasizing money itself makes it hard to cut losses when losing money, and even harder to hold onto profits when making money.
Those with a get-rich-quick mindset often exhibit the following three characteristics:
When it comes to selecting coins, they tend to favor small-cap altcoins because the market generally believes that smaller coins have more room for growth. However, the reality is that explosive dark horse coins are extremely rare; 99% of coins, when compared to Bitcoin, are on a continuous decline. In terms of risk control, those with a get-rich-quick mindset usually have a small capital base, so they cannot talk about allocation and risk diversification and often buy in with all their funds, greatly affecting their investment mindset. When net value experiences a drawdown, investors feel significant psychological pressure, resulting in frequent trading, swinging back and forth like a fan, becoming the market's prey. In terms of profit-taking, the concept of taking profits is almost nonexistent; they tend to say 'I'll sell if it goes up a bit more' and often miss the opportunity to exit at the peak. This is also the reason why many who became wealthy during the bull market in 2017 fell back into the lower tiers, or even worse. Greed is endless; the word 'greed' is almost synonymous with poverty, and the word 'avarice' is almost synonymous with destruction.
4. Zhao Kuo Type
Knowing so much yet still losing money. After losing money, most people turn to learning to improve their understanding, reading books, and enrolling in courses. They understand more each day, often posting insightful comments on forums, but secretly they are losing money in confusion. Why? Because they mistakenly believe that 'analysis = prediction = trading.'
However, analysis and trading are completely different matters. Analysts adhere to a philosophy of trying to make each prediction as accurate as possible and tend to exaggerate analytical skills, belonging to the theoretical school. The representatives of trading, traders, never make predictions about future trends; their focus is on studying price distribution characteristics and establishing orderly trading rules from a chaotic market. Investment is different from pure theoretical research; the market is the market, just like a battlefield. Many people can analyze but cannot trade; in simple terms, their trading systems are vague; they only see trends but do not know how to buy or sell, and even fail to control the most basic psychological fluctuations.
Those who can talk about it but can't do it, and those who can do it but don't talk about it. This is probably saying that you shouldn't aim to be an analyst, but strive to become a trader.
5. Perfectionism
We keep jumping from one system to another, one method after another, in search of some kind of investment 'holy grail.' However, no matter when you place an order, there will always be a more favorable price appearing, and after each liquidation, the market will show you a better exit price.
The pursuit of perfection is a human trait. Striving for perfection can lead to the complete neglect of execution and discipline, causing countless people to lose themselves in the pursuit of perfect trading.
The essence of trading is just probability; there is no such thing as a perfect trading holy grail. However, this does not prevent you from making money; if you can scoop up water from a vast ocean, you have already succeeded.
Investing is a game for those who are good at losing (good losers), regardless of how skilled you are, if you incur a loss of 100%, it's game over. This is why risk control is essential, and to avoid such a 100% failure, some small losses are inevitable. 'Good at losing, small mistakes' is key to surviving and succeeding.
Pursue excellence, but do not pursue perfection.
