Establish a position
"Opening a position" means opening a position, also known as exposure, that is, buying one currency and selling another at the same time. The currency bought after the opening is called long, and the currency sold is called short. Choosing the right exchange rate level and the timing of opening positions are the premise of profit. If the timing of entering the market is good, the chances of profit will be great; On the contrary, if the market timing is improper, it is easy to lose money.
"Stop loss and lighten the position" is a stop loss measure taken to prevent excessive losses when the exchange rate of the currency held falls (the currency held depreciates) after the position is established. For example, sell dollars and buy yen, and the exchange rate is 1 10. Later, the exchange rate of the pound against the US dollar rose to 1 15, and the nominal loss has reached 5 yen. In order to prevent the continuous rise of the US dollar (that is, the depreciation of the Japanese yen) from causing greater losses, we repurchased the US dollar and sold the Japanese yen at the exchange rate of 1 15, ending the exposure with a loss of 5 yen. Sometimes traders do not admit losses, but insist on waiting, hoping that the exchange rate will turn back, so that when the exchange rate falls blindly, they will suffer more losses.
The timing of "profit" is difficult to grasp. After opening a position, when the exchange rate has developed in a favorable direction, you can close your position and make a profit. For example, buy dollars and sell yen at 120; When the dollar rose to 122 yen, two yen were already profitable, so I sold the dollar and bought back the yen to level the dollar position and earn the yen profit. Or even take out the original amount of selling yen and earn profits in dollars, which is flat profit. It is very important to grasp the timing of profit, because the lottery is too early and the profit is not much; Too late to draw, it may delay the opportunity and reverse the exchange rate trend.
The principle of buying up and not buying down
The principle of foreign exchange trading is exactly the same as that of stock trading. It is better to buy up than to buy down. Because there is only one mistake in the process of price rise, that is, when the price rises to the peak. In addition, any other point of purchase is right.
When the exchange rate falls, only one thing is right, that is, the exchange rate has fallen to the lowest point. Besides, it is wrong to buy it at other points.
Because there is only a little mistake in buying when the price goes up, and only a little right in buying when the price goes down, the chance of making a profit when the price goes up is much greater than when the price goes down.
"Pyramid" overweight principle
"Pyramid" overweight means that after buying a certain currency for the first time, the exchange rate of the currency rises and the investment is correct. If you want to increase your investment by increasing your holdings, you must follow the principle of "increasing your holdings less than last time". In this way, the number of consecutive purchases will be less and less, just like the "pyramid". Because the higher the price, the greater the possibility of approaching the peak of the rise and the greater the danger. At the same time, buying when rising will increase the average cost of bulls, thus reducing the rate of return.
The principle of buying (selling) when hearing rumors but selling (buying) in real time.
Like the stock market, some gossip and even rumors are often circulated in the foreign exchange market. Some news proved to be true afterwards, and some news proved to be just rumors, even a trap deliberately laid by the dealer. The trader's practice is to buy as soon as he hears the good news, and make a profit as soon as the news is confirmed. On the contrary, when bad news comes out, sell it immediately, and once the news is confirmed, buy it back immediately. If the transaction speed is not fast enough, it is likely to lead to losses or missed profit opportunities due to market changes.
The principle of losing money without overweight.
After buying or selling a sum of foreign exchange, when the market suddenly moves in the opposite direction, some people will want to increase their positions, which is very dangerous. For example, if a foreign exchange keeps rising for a period of time, traders will chase up and buy the currency.
Suddenly, the market reversed and plunged downward. When traders see that they have lost money, they want to buy a single order at a low price in an attempt to lower the exchange rate of a single order. When the exchange rate rebounds, they will close their positions together to avoid losses. You should be especially careful about this overweight practice.
If the exchange rate has been rising for some time, you may buy a "top". If you keep buying and raising prices, but the exchange rate never looks back, then the result is undoubtedly a vicious loss.
Do not participate in uncertain market activities.
When you feel that the trend of the foreign exchange market is not clear enough and you lack confidence, it is better not to enter the market. Otherwise, it is easy to make a wrong judgment.
Don't blindly pursue integer fractions
In foreign exchange trading, sometimes things will go wrong in order to win a few points. Some people set profit targets for themselves after opening positions, such as earning enough US$ 500 or RMB 65,438+0,000, and wait for this moment in their hearts. Sometimes the price is close to the target. The opportunity is good, but it is still a few points away. I could have closed my position and collected the money. But because of the original goal, I missed the best price and missed the opportunity in the waiting.
Establish a position when the market breaks through
The market refers to a bull market, and the exchange rate volatility is narrow. The market is a sign that buyers and sellers are evenly matched and temporarily balanced. No matter in the process of rising or falling, once the market is over, the market price will break through the barrier, up or down, and there will be a breakthrough. This is a good opportunity to enter the market and open positions. If the market is a long-term bull market, the position established when breaking through the market has a greater chance to make a big profit.
Why stop loss and take profit?
Why stop loss? Many friends are very careful when they start to speculate in foreign exchange, so they can always make a little money. They often earn dozens of points at a time, but let go of the big market of hundreds of points. The next time the exchange rate is high, he often thinks so. I want to grasp the big market this time. As we all know, the market is almost at the top of the stage at this time, and the mood of earning hundreds of points affects him. Originally, the market still had dozens of points to rise. He insists on doing long-term work and won't leave until he earns a few hundred cents. As a result, not only dozens of points were not earned, but they were trapped and lost, and they didn't win. This is how the market sometimes plays tricks on people.
Huimin friends often have such an operation: after buying a currency, the exchange rate drops sharply and stops quickly. I'm still glad that the exchange rate continues to fall! However, a day or a few days, or even a few hours later, the exchange rate suddenly rebounded and rose sharply, making it too late for you to buy again, even higher than the price of your stop loss. If you didn't stop just now, what profit would you have? After this several times, there is no concept of stop loss. I have tasted the sweetness of not stopping the loss several times before, so I have never stopped the loss. I thought the exchange rate would return to the price above the purchase price sooner or later. With hundreds of points, I may be tempted to stop loss. In this way, I lost all the money I earned in the previous few times and suffered a loss.
So be sure to pay attention to the necessity of stop loss. How to stop loss and take profit? When should I stop loss? When is it not necessary to stop loss? When should we resolutely stop loss? When do you want to make a profit? How to set the take profit position? The most difficult thing to learn about investment and financial management is stop loss. I deeply feel that there is a lack of books on how to stop losses in the market. Yes, there is no clear explanation for Huimin from the perspective of actual combat. It's just a rough idea, which is far from actual combat. So I want to talk about the skills of stop-loss and profit-taking separately, and strive to make the use skills of stop-loss and profit-taking clear and operable.
When you first entered the foreign exchange market, how much did you intend to lose and stop trading? Doing foreign exchange trading is an investment. Any investment should be risk-conscious. In every industry, some people lose money, some people make money, or everyone will become Gates. In this high-risk industry, no one has not lost money. Everyone who can survive in this market must first learn how to control risks, in other words, how to control losses.
In your foreign exchange speculation career, there is a story that may give you a lot of inspiration. There is a Nanjing native who is engaged in foreign exchange margin trading. At first, his capital was equivalent to RMB 6,543,800,000. He kept trading, and soon his capital increased by 10 times. At that time, his mother advised him to leave a sum of money because she knew the speculation and risk of this industry. However, the son's mind has already expanded. Think of yourself as a wizard in this market, making money is as easy as drinking water. Don't listen to other people's advice. At this time, he gave his mother 2 million yuan impatiently. At that time, 2 million yuan was not a small sum, and it could be called a rich man. He said it was his son's pension money to honor you, and then he killed the foreign exchange market without looking back. During that time, he always held a long position in the pound, and he also used the money he earned to increase his position at a high level. Then bad luck came. A man named Soros attacked the pound and became famous from then on. He succeeded in preventing the pound from plummeting. As a result, Britain was forced to withdraw from the European monetary mechanism, so that many people still hold different opinions when it comes to the pound joining the euro zone today. When the pound fell, the man still stubbornly held the pound, thinking that according to the usual practice, the fluctuation of the foreign exchange market would not exceed 200 ~ 300 points a day, so he clung to the pound and waited for the pound to rebound. I don't know, that large sum of money has been depreciating. In the blink of an eye, he has lost 50% of his funds. At this time, if it is not too late for him to stop loss, after all, there is still half of the funds. Shepherd would rather lose wool than sheep. In the case of so much loss, he still reported his luck, thinking, it won't be like this. There should be a rebound. After falling so much, maybe it will rise back later. As a result, he firmly held the position of the pound without a stop loss. The market did not take his will as the transfer, and the exchange rate triggered a new round of decline. In the end, the loss was serious and he was forced to give up. Because, this is also his helpless choice, his account has been completely annihilated.
Later, this person left the foreign exchange market and never set foot in this industry again. As soon as he hears about foreign exchange speculation, he will lose interest. He returned to Nanjing and started a company with 2 million yuan saved by his mother. That's 2 million. Get him back on his feet. If he had invested this 2 million, I'm afraid he would have lost all his money. His mother is a smart person, so she gave him a "stop loss" for this fund, leaving a way out for future development.
Friend, after listening to this story, when the market trend is contrary to your own practice, you should carefully observe the position of the exchange rate. If the exchange rate fluctuates within a narrow range for several days in a row, this fluctuation may be a breakthrough, which we can observe from the chart. If this is the case, we should admit the mistake in time and solve it immediately. If the trend shows no signs of reversal, you should reluctantly sell at a small loss and leave immediately to minimize the loss. Domestic personal foreign exchange transactions can only buy more, not short. When the dollar rises, it is necessary to firmly hold the dollar and throw out other currencies. At this point, novices in investment and financial management are most prone to make mistakes. Most of them still don't admit that their judgment is wrong after the wrong transaction, so they stick to it and eventually lose more and more. This is because the mentality has changed, which will affect the next operation, and even affect your confidence in the foreign exchange market, thinking that you are not cut out for this. In fact, you just haven't found a way to operate in the foreign exchange market. Remember, any investment and financial management must pay some tuition fees, just how much. Many well-known investors in the foreign exchange market suffered heavy losses when they first entered the foreign exchange market. It's just that they found the reason for their mistakes and tried to avoid such mistakes in future transactions. In this way, they succeeded. Friends, if you want to invest and manage money in the foreign exchange market, please learn to control your losses first!