______________

This paper is a train of thought for investment.

It may seem a little boring.

But when you actually operate and use it,

Clear thinking has become the most important item.

Because thinking is the only thing we know now.

Can transcend time, beyond space.

Irregular, stateless thing

When you can solve it smoothly

You will gain great power.

This is what every investor should do.

One,

Trading is a big topic, which is always summarized as technical analysis, but it actually contains a lot of content.

We know that there is still a long way to go from a market to the profits we earn.

The whole link and process can be roughly divided into

After seeing a market correctly, placing orders, trading, holding positions and finally making profits, after a series of steps, a closed loop is finally formed.

So this closed loop, we call it a framework.

It is an important blueprint for building a framework.

Second,

A framed classification needs to place this matter according to a classification idea.

When we come into contact with market information

The first thing we need to know is this information, this event, which is the trading signal.

Where is this goal in the whole trading framework, whether it is event-driven trading, message-driven, fundamental improvement or multi-cycle vibration, and so on.

He produces price changes according to some driving factors.

After this driver comes into being, we should make the next decision, which will help us to buy or sell.

And decide which target to buy and which market state to correspond to.

After determining the driving factors, should we know something, such as behavior analysis?

Then analyze the overall market sentiment through these things.

Then, it is to operate the whole process.

Then the operation specifically includes:

Your business, your increase, decrease, short position, open position, and so on.

And these are all due to behavioral analysis.

As we all know, the so-called technical analysis belongs to the "trading system" of behavior analysis.

Many people will ask, what is technical analysis used for?

A: Technical analysis is used to form a trading system.

Then when it comes to trading, it's not just technical analysis.

When your behavior happens, will there be some changes in your mood and psychology?

Help you build a position and make a deal.

These are actually things in behavioral analysis.

Only by handling the step of behavior analysis can we make a profit in the market.

Generally speaking, it is to sort out the whole thinking thread properly.

Transactions in various markets need methodology.

Only under the premise of methodology can you analyze, judge and make profits in some ways.

What is the above methodology? Is what you call a three-view world view.

Third,

What are the processes for a complete transaction?

In a complete trading process, he forms a trading strategy through analysis, and then forms the execution of your trading strategy.

Simply put, yes.

Plan your trade, trade your plan.

In the process of implementation, it involves your ability to "integrate knowledge with practice"

It involves some modifications to your plan.

If your plan is wrong, do you want to give up or participate in small positions?

That's right. Like Soros, opening an empty bill of one billion dollars is not enough to directly open an empty bill of twenty billion dollars.

What needs to be done after the strategy and implementation are completed?

risk control

Risk control is divided into two parts, the first part is take profit, and the second part is stop loss.

In fact, it's all about when to go out after entering the stadium.

When the risk control, that is, exit, is completed, we need to summarize and analyze the transactions to see if each of your transactions is in line with your decision this time.

The gains and losses of this analysis, we learn from experience, we learn from lessons.

Transaction process:

Analysis-Forming Trading Strategy-Implementing Trading Strategy-Risk Control-Summary

four

Analyze the problem:

We are all familiar with fundamental analysis, technical analysis and emotional analysis.

These are all analysis links, but it is another story to focus on where and what to look at.

For example, let's take A shares as an example.

When we make another inventory,

Then we must first look at a big financial environment.

The financial environment can be simply classified according to Dow theory (which will be explained in detail later) and classified as an exponential state.

Judging its exponential state

And then judge the cycle we are in now.

Supplementary explanation:

Period:

In the process of motion change, some features appear repeatedly, and the time it takes for them to appear twice in a row is called cycle.

And generally more common cycles, such as:

Kondratiev period

The long period is about 50-60 years.

Kondratiev believes that the transformation of production technology, war and revolution, the development of new markets, the discovery of gold deposits, and the increase of gold production and reserves are not the fundamental reasons for the long-wave movement.

For example, the expansion of new markets generally does not lead to long-term economic prosperity. On the contrary, economic prosperity will make it possible and necessary to open up new markets. New discoveries of technology generally appear in the long-term decline stage, and these new discoveries will only be applied on a large scale at the beginning of the next big rise stage.

Because of the high tension caused by the long-term rising stage of economic strength expansion, it is also the main factor to provoke war and revolution.

Kondratiev believes that the root of long wave is those things inherent in the nature of capitalist economy, especially those closely related to capital accumulation.

Juglas cycle

Periodic fluctuation of capitalist economy lasting about 10 years.

While studying the statistics of population, marriage, birth and death, Juglas began to notice that economic things fluctuated regularly.

He believes that the existence of crisis or panic is not an independent phenomenon, but one of the three stages of social and economic movement, which are prosperity, crisis and depression, and the cycle of the three stages forms a periodic phenomenon.

He also pointed out that crisis, like epidemic, is a social phenomenon of developed industry and commerce. To some extent, this cyclical fluctuation is predictable and can be alleviated by some measures, but it cannot be completely suppressed.

He believes that politics, war, agricultural failure and climate deterioration are not the main sources of cyclical fluctuations, but can only aggravate the trend of economic deterioration. Cyclical fluctuation is an automatic phenomenon in the economy, which is directly related to people's behavior, savings habits and the way they use available capital and credit.

Generally speaking, Zhu Lan cycle is viewed from the ratio of equipment investment to GDP. Comparing the nominal ratio of equipment investment to GDP and the leading indicator of investment income after two years (investment income refers to the profit rate before interest payment of total capital, which is simply the interest rate of deducting interest liabilities or financial expenses from the profit rate of enterprises), it can be seen that the trend of investment income indicates the ratio of equipment investment to GDP.

Real estate cycle

The real estate cycle refers to the ups and downs of the real estate economic level and the cyclical economic phenomenon, which is characterized by two stages of expansion and contraction alternately in the economic operation of the real estate industry and four links of recovery-prosperity-recession-depression cycle.

(1) recovery and growth stage: at this time, the last round of depression caused the real estate economy to fall into a long-term downturn, the owner-occupiers entered the market, the investment and speculative demand basically did not exist, and the price and rent were low. House prices began to pick up, a few speculators entered the market, the market transaction volume increased, and the vacancy rate decreased. Various factors drive the house price to continue to pick up slowly, the market is full of optimism, investors are full of confidence, the market is expected to improve, and real estate investment is stronger.

(2) Prosperity stage: this stage is shorter than the recovery stage, and the peak period is fleeting. The specific performance is: the amount of real estate development has surged, the variety has increased, speculators are active, and the market speculative demand is higher than the demand for self-occupation. The government began to introduce policies to restrict real estate speculation, and the speculative enthusiasm continued to be strong, and the self-occupied demanders basically withdrew from the market. In fact, there is no market if there is a price. Furthermore, the number of new investments has decreased, the sales difficulty has increased, the turnover has decreased, the vacancy rate has increased, and the market has become pessimistic.

(3) Crisis and recession stage: when investment and speculative demand cannot be transformed into consumer demand, and high housing prices exclude real home owners from the market and rely only on speculative funds, it shows that the inflection point of the real estate cycle has dropped to-from prosperity to recession. Recession means that the economy will experience negative growth for two consecutive quarters. At this stage, the performance is as follows: the transaction volume is shrinking, the real estate investment is declining, and the market pessimism is strengthening. Affected by some sudden bad news or events, house prices plummeted, speculators panicked and sold, and real estate prices plummeted. Then small developers went bankrupt one after another, some projects under construction were unfinished, a large number of speculators were trapped, and the number of unemployed people in the real estate industry surged.

(4) Depression stage: After the rapid and painful crisis broke out, the real estate cycle entered a long-lasting depression stage. Depression is a serious economic recession, which means economic collapse. The performance is as follows: house prices and rents continue to decline, the transaction volume drops sharply, the vacancy rate remains high, and a large number of real estate developers go bankrupt. At the end of the Great Depression, the real estate bubble was squeezed out, the normal market demand grew slowly, the government reduced restrictive intervention, and market fluctuations began to stabilize. Real estate is slowly transitioning to the next recovery and growth cycle.

Kitchen period (also known as short wave theory)

About 3.5 to 4.5 years.

Joseph Kitchen believes that when manufacturers produce too much, they will form inventories and reduce production.

See if there is an upward cycle in these cycles. Is this cycle a * * * vibration cycle or a small cycle?

For example, today's commodity futures are in a "Kichin cycle" and a destocking cycle.

There is a rebound in the destocking cycle, which constitutes part of the logic.

In addition, participating in the market also needs to look at the atmosphere.

Observe whether the whole market atmosphere is active.

Are you in a market where everyone is actively going long or short?

For example, in 2003-2005, the volume of A shares was very low.

Then it is also very intuitive to show that based on this weak and depressed market, we have no need to participate.

On the contrary, you can participate in the investment direction of US stocks, Hong Kong stocks and other atmospheres.

Reorganization logic

Use a few examples to further illustrate the above.

When we lock in A shares in N markets,

So what is the current state of our A-shares, whether it is a bull market or a volatile market, or a market state with money-making effect, or a market state of desert oasis, these are all to be considered.

Whether a market is long or short and whether a market is strong or weak should be included in your analysis.

Participants' willingness to go long and short, and their participation, such as popularity, are also important.

Then there is the securitization rate of the whole market, the memory of the whole market.

Take commodity futures as an example

You must first analyze the financial environment of the whole market, whether it is deflation environment or inflation environment.

Is the dollar going up or down? Do you want to be long or short as a whole?

So does the futures market have to choose a specific target?

Then how to choose the specific target involves a fundamental problem.

By observing a variety, or a department of a variety, its supply and demand relationship.

Decide which ones are the weakest and which ones are the strongest.

When you are in a short market, then we must be the weakest.

During the bull market, A shares fluctuated greatly.

Just like not long ago, lithium batteries, organic light-emitting diodes, semiconductors

After that, I switched to virtual reality, augmented reality and mobile games, all of which are relatively strong.

Up to now, Xiong 'an and environmental protection are relatively strong hot spots.

Choose the market first, and then choose the sector.

The market has chosen, and the target has also been chosen.

So should we choose a place to participate?

Because we know that the position advantage is determined by the cost.

When you choose an advantageous position, you will hardly feel any pressure in the future position.

This also involves a very complicated problem, many people will ask, how can we achieve "integration of knowledge and practice"

It's actually quite simple. Your entrance position is uncomfortable, you chase it, just like you chase Zhongke Chuangda at 280-290.

Although the stock has doubled in the back, your position will not be comfortable and your fear will be high.

Then behavioral analysis determines one of your location advantages.

This is the first point.

The second one is very clear, which determines the size of your position.

For example, if you are sure about this market, then do you do it with normal positions, over-allocation positions or light positions?

This point is actually decided in the analysis.

If you are interested in finance and mathematics, you can use Kelly formula to calculate the most suitable position.

Back to the main line, is the market selected, the sector selected, the participating positions determined, and the positions determined?

Generally speaking, this is an analysis.

The second important idea-pragmatism

In other words, obvious trading strategies are not profitable in this market.

Whether you use Zhouyi to analyze, or use some textbooks of ordinary classes to analyze, or use the so-called hot money wild way to analyze.

So in the end, you all want to get excess profits, so this involves pragmatic analysis.

I ching, for example, is also an analytical thinking.

Teaching materials are not limited to classes.

As long as it works, we can use it.

After a series of analysis, we need to form a so-called "trading plan"

Trading plan is also called "trading strategy"

Which goal to achieve, where to do it, what position to participate in and when to participate. How to get in, how to get out, what to do when it goes well, and what to do when it doesn't.

Why should we form our own trading strategy? Because when you make a strategy, this idea and this plan must be beneficial to you.

If the plan is not dominant for you, then it is not dominant. Give it up.

This is the biological application of grid theory.

Darwin's theory of evolution, natural selection, survival of the fittest, survival of the fittest.

Then, after a plan is produced, the job is to carry it out.

And it must be implemented according to your "trading system".

Trading system is an objective system.

It should be noted that any analysis and thoughts before you enter the market are subjective.

You can follow your own experience or your understanding of the market, which is subjective.

When the strategy is formed, when you want to enter the market, everything becomes objective.

In the trading system, besides external factors such as fundamentals, policies and cycles, it also depends on technical analysis.

In the technical analysis:

First of all, you judge a trend and apply it to the trend.

Like moving average, MACD, Dow theory and trend line, these are some of the most basic and simple methods to judge the trend.

So after the trend is clear, for example, when are you going to do more?

It must be in a bull market. When we reach a counter-pressure position, we will do more.

Charles Road can be divided into three trends, big trend, small trend and middle trend.

The general trend includes several years, the medium trend includes several months, and the small trend is chaotic.

What he called clutter is also a trend, covering several weeks. We all think that these three cycles may have little to do with one cycle we actually operate.

In fact, we went to study the book Technical Analysis of Futures Market (written by john murphy).

In the fourth chapter, he focuses on the trend problem.

The extension of this trend is Livermore's "three-screen thought"

The concept of three screens, as the name implies, is that a computer has three screen monitors, which display different levels and time periods respectively.

At this time, we can see three completely different scenarios, three trends, three wave rates and three forms, and at this time, we have our trading opportunities.

To put it simply, its core is that there are three trends in the market, the big trend, the middle trend and the small trend. Then our technical analysis is to grasp the fluctuation according to the changes of these three trends.

Core idea: follow suit

Only by adapting to the market and changes can we maintain our vitality forever, which includes changes in time, potential and change.

Five,

Implementation ability

When we talk about trading strategy and trading system, a very important link is execution ability and mentality.

Many times, there are many highs and lows that you can't see, but where are greed and fear?

The position was lucky, and the inert trading at that time made you not decisively short or open a position in that position.

This mentality is actually normal. When training traders in normal private placement, it takes about three years to place tens of thousands of orders and form muscle memory.

The so-called muscle memory is a trading inertia, or a trading habit.

In other words, the correct concept, you must through one of your trading habits, in one of your actual operations to reflect.

This intermediate process of spanning and knowing and doing requires a lot of time and long-term training, which becomes an instinctive and conditioned reflex.

But many times you will also find a problem.

Your strategy has been worked out.

But the next day, or you were waiting for that point, the market didn't give it to you.

Either earlier than your plan or later than your plan. In fact, there are fewer times when it is just right.

Then we need to revise the original plan.

You also need the ability to improvise.

Six,

Transaction summary

Summarize the core, the core is to summarize your capital curve.

Because when we look at a target, we are all looking at a chart. Is it a bullish trend or a bearish trend?

Then you have to draw your trading curve and capital curve every day.

See if your curve is a cow or a bear.

If your curve is bullish, push it up steadily to keep the current trading status.

A moment of position, a moment of goal, a moment of style.

However, when you find that your capital curve has fallen sharply.

You must stop first and sum up the reasons.

Why stop first? Because after the bull market has a counter-kill, it is generally a shock.

Then if you continue to participate, you are likely to get out of a short market.

For another example, one of your capital curves is now oscillating.

Then you should think about it. Is your current trading philosophy correct?

Or is the state of the market inconsistent with your trading strategy? You should consider these problems.

The core is to summarize the trading concept, consider your capital curve, consider your maximum withdrawal ratio and a continuous withdrawal number, consider these elements and consider these indicators.

If you have made a transaction recently, or you have made several wrong investments in a row, you must stop.

Think about the problems of system, market, mentality, planning and implementation.

There must be a link that is wrong.

At the beginning of the chapter, I also said that the distance from the market to the intermediate process of your final profit is very far.

It's normal for you to see right and wrong, and it's normal for you to get a little bit if you do it right.

You guessed it. Your status is low, which is normal.

These things are actually normal, so the best operation is

It is our ideal state to get the largest market with reasonable positions.