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What is a trading system?
From novice to experienced investors, we often receive questions about "what is a system". The purpose of this article is to give you as clear information as possible. First of all, we will review some background information to help you understand what the system is outside the transaction content. You will learn that the systems owned by different people are related to their attitudes towards money. The second paragraph of this article will focus on clear definitions. The third part will discuss the extended part of the system-trading plan. Finally, we will discuss the key factors in system development. The business system is in Robert Toru Kiyosaki's book Cash Flow Quadrant. He distinguished between two kinds of people who work for money and two kinds of people who let money work for them. In each case, the main difference between the four of them is how they deal with money. First, let's look at the business system. McDonald's is a typical large-scale system buyer. In fact, a franchisee must go to Hamburg University to study for six months (I think it is the length of time) to learn the system of opening a store. The system includes food delivery, meal preparation, greeting customers, serving in one minute, cleaning and so on. All these systems can be easily completed by a college-level manager and employees who may drop out of high school. In other words, the system is repeatable, simple enough to be operated by a person who is not very smart 16 years old, and good enough to keep customers flowing. Now that we know the definition of a system, let's look at how people related to the system are in the four cash flow quadrants. Employees: Employees usually put safety first. They have jobs and make money from them. Employees usually run the system. They don't need to know that they are running the system, but this is their function. For example, employees who are selling goods will greet customers and place orders. The employee is running the "Greet the Customer" system. Most employees don't understand this system. They only know what their job is. It's like an employee of a trader, or acting like a trader. Their typical questions are "What stock should I buy", "What will the market be like" and "What should I do". We can always see such problems. For example, when I wrote this article, a gentleman just bought the American consumer news and business channel. He asked the guests, "What direction do you think the war will affect the market? How do we make money from it? " These are typical employee problems. They always say, "I don't understand this very well. Please tell me how to do it." The financial media prospered by answering these employee traders. Self-employed: Self-employed is a typical driver with strong desire for control and doing things right. Pay attention to how these drivers I often talk about constitute some prejudices that most traders need to control the market correctly. Self-employed is the whole system. Basically, they all run so monotonously, but they just don't know it. Moreover, the more you do, the more tired you get. Like employees, self-employed people work for money. However, they prefer this job because they are changing. To some extent, it is true that the harder they work, the more money they earn. But usually, the harder they work, the more tired they feel. However, they still think that they are the only people who can do the right thing. As I said before, self-employed people are basically systems. Usually they can't see the system because they are part of it. They are details. Besides, they have a strong tendency to complicate things. They are always perfectionists, and they believe that a perfect system must be complicated. They always ask "What can make my system perfect". Some people trade in the spirit of self-employment, such as doctors, dentists, and others who own their own small businesses. In these small businesses, they are basically experts in the same system. This is also the way they want to know and trade. They want to increase complexity until they run, even if this strategy rarely works. Self-employed people are like a system of free decision, which can change constantly. Business owner: A good business owner should be able to leave the company for a year and come back to find that the company is running better. This is an ideal state, but there are theoretical facts. This is because the business owner's job is to design a set of systems, and his employees can work by themselves (or at least under the leadership of a manager).