Suppose a trader makes 300 trades a day, of which 60% makes money, with an average of 2 points per share, and the other 40% loses, with an average of 2 points per share. If his position is 2000 shares at a time, then his profit trading * * * earns 7200 dollars (2000*0.02 dollars *300*60%=7200 dollars), while his loss trading * * * loses 4800 dollars (2000*0.02 dollars * 300 * 40%). The transaction cost is about $2 for 1000 bilateral shares, $0/200 for 300 transactions, and $0/200 for the last day's profit.
The profit model of ultra-short-term trading has three indispensable components: First, resolutely stop loss and control the losses within a set range, otherwise the number of transactions that make money in time is far greater than the number of losses, and it is still possible to make no money; Second, there is a certain correct rate, 60%~70% of transactions can make money, don't expect too much; Third, there are enough transactions every day, and only a large number of transactions can guarantee the validity of probability; Only when there are enough times can we give play to the advantages of low cost and high speed; Only enough times can we forge excellent traders as soon as possible-which is why it is said that "learning to trade, it is best to start with ultra-short-term trading".
For an ultra-short-term trader with stable profit, there are more than 300 transactions every day, including about 200 gains and more than 0/00 losses/kloc. In the face of this 100 loss-making transaction, he must resolutely stop every time and never take any chances. If the stop loss is not firm, the consequences will be reflected immediately. Retail investors may not be punished in the short term if they don't make up their minds to stop loss, but they can still taste the sweetness. The market reversal may take a year or two, which will lead to great losses. Ultra-short-term trading forces the trader to stop resolutely more than 100 times a day, so it can help him develop the good habit of stopping resolutely as soon as possible.
At the same time, in the face of a loss of more than 100 a day, traders must accept the loss frankly, otherwise they will not be competent for their work. In our nature, most people can't accept the loss. Big losses, such as the loss of a loved one or accidental disability, and small losses, such as failed exams or financial theft, are not so easy to accept, and will make us experience long or short pains. Some people are even in deep pain, unable to extricate themselves and choose to commit suicide.
One of the reasons why trading is so difficult is that losses are an inevitable part of trading, but most people can't accept it calmly. They may avoid losses, so they can't stop losses resolutely; Or afraid of losing money, so I dare not boldly open a position; Or angered by loss, so I can't stay calm; Or worry about losses, so you can't focus on the current transaction. Ultra-short-term trading forces a trader to face more than 100 losses every day, so it can help him become a "real warrior" faster-dare to face a bleak life and dare to bleed. Trading is not an affair, not an entertainment, but a job of "adding blood at the tip of the knife and repaying kindness with revenge". If you want to chop people up, you have to accept the loss. After the baptism of tens of thousands of transactions in a few months, ultra-short-term traders can accept losses more quickly and regard losses as the cost of transactions-the cost is inevitable, but it can be controlled and must be controlled.