Buffett believes that if investors can look at stock investment from the perspective of business owners, that is, if you can pay attention to the inspection of buying stocks like the whole acquisition company, then the return on investment can be guaranteed and the investment mistakes can be greatly reduced. Here, I want to share some information about two different stop losses for your reference.

What about different stop losses?

One is a structural stop loss; One is the fund management stop loss.

The former is set at the critical point of price movement trend; The latter is set within the predetermined range of profit or principal loss.

The former is a trend transaction based on whether the stop loss is the judgment of the market; The latter is a fund management strategy based on big profits and small losses.

Many people can't tell the difference, and naturally it can't be set and used scientifically.

The most common mistake is that trailing stop is a typical stop loss in fund management, but users require it to be used with the structural stop loss function.

-structural stop loss is a backhand transaction with stop loss at the same time, because the structural stop loss point is the turning point of the trend;

-trailing stop just closed his position, not backhand, because trailing stop doesn't represent a trend change.

Trailing stop is often used in combination with the trading strategy of "take profit by a large margin and stop loss by a small margin". The specific usage needs to be studied by ourselves or discussed by everyone, and there is no open routine to follow.

The real confusion of traders is often: in the face of the reverse fluctuation of the current price relative to the position, is the future just an adjustment or a new trend? In my opinion, structural stop loss must be used to solve this problem.

The setting methods, principles, purposes and even strategic systems of moving stop loss and structural stop loss are quite different, but they should also be combined, such as judging the trading direction with structural stop loss and protecting profits or costs with moving stop loss. Whether the combination of the two is better is another question. I prefer simple operation and don't want to complicate the trading conditions, so I have never used it in combination.

How to stop loss correctly

When should I sell my stock? According to experts, sell stocks after falling. What do you mean, just don't predict when it will peak, and don't predict when it will fall, wait for the market to give an answer, and then operate after the trend turns. This is the so-called right-hand transaction.

Trading on the right is a follower of the trend, not a predictor. When there is a bubble in the stock market, you don't often predict the top, but sell the stock at the second highest price after the top is formed, instead of pursuing the highest price. It seems silly, but it is the best strategy in practice. For example, if you buy a stock in 10 yuan, when it rises to 12 yuan, you are worried that the market will peak and choose to sell the stock. But the stock market continued to rise, and this stock also rose to 13 yuan. You regretted it and bought it back, but the stock price went up. Here we are at 15 yuan, and you are afraid again, so sell on rallies. As a result, the stock price went up, and you 17 yuan bought it back. Then the stock price went to 20 yuan, you sold it again, and then 22 yuan bought it back. Then the stock price began to fall. When it comes to 2 1 yuan, you are reluctant to sell, and 20 yuan is still reluctant to sell. 19 and 18 were finally quilted.

The correct way is to set a stop loss in 9 yuan after buying in 10 yuan. When the stock price rises to 12 yuan, the stop loss is raised to 10.8 yuan, when the stock price rises to 15 yuan, it is raised to 13.5 yuan and when the stock price rises to 22 yuan, it is raised to 19.

Some people say that we should leave some profits for others. It's called eating fish instead of fish head and tail. I don't think this statement is particularly accurate. We should start to intervene when others eat fish heads, eat fish tails in the middle and then eat fish tails. Later, we found that the fish tail had thorns, so we spit it out and finished the process of eating fish.

What is the stop loss? What is the essence of stop loss?

What is the stop loss in futures and securities trading? This question seems simple, but many people-even trained people with long-term trading experience-don't really understand it.

In essence, trading stop loss is actually a "no" judgment on the market. If the different states of the market can be distinguished by "A" and "B",

Then, if the "yes" judgment is to identify the market state "A", then the "no" judgment is to deny the market state "A" and identify the market state "B".

From the logic of trading behavior, the correct stop loss operation can also be explained in line with its essence, while the trading behavior of random stop loss can not be logically justified.

First of all, you have to stop loss, unless you continue to hold positions in a certain trading direction, which will only increase losses and will not make profits. In other words, stop loss is only when the direction is reversed, and a homeopathic trading position should not stop loss. Such a stop loss is in line with the correct trading behavior logic. Other than that, it doesn't make sense logically.

For example: "psychological stop loss"-stop loss because of bad psychological feeling! This is precisely the important source of the failure of futures trading and the enemy of profit, which is not worth refuting. If you often stop psychologically, don't do futures because you are not qualified at all.

For example, "stop loss for capital safety"-this statement is meaningless. Engaging in risky transactions such as futures and securities is bound to bear certain risks. In futures and securities trading, there is no absolute "capital security", only relative "capital security". Capital security is based on a certain allowable loss limit, that is, risk limit, which can and must be completed in advance by controlling the amount of open positions. If you often cause "capital safety stop loss" because of a large number of open positions, it means that you have not mastered the basic operation of risk control, so make up this lesson first.

Even the correct stop loss will cause financial losses, which is inevitable. However, the correct stop loss is just "eat small losses and make big losses". Therefore, if you can logically understand and execute the correct stop loss, you should be happy.

If you have never done "psychological stop loss" and "capital safety stop loss", you know that the correct stop loss is a good thing, and you always feel that there is something wrong with your stop loss. Then, you must consider whether there is something wrong with your market judgment system! Because, since stop loss is the judgment of market judgment, a certain stop loss method is bound to be subject to the corresponding market judgment system, and the so-called market judgment system that cannot provide the correct stop loss method will not provide the correct market judgment. This can also be used to judge the authenticity of a market judgment system, to judge the authenticity of a trading expert, to judge whether you really have mastered the market judgment technology, and so on.