The general process of stock trading:

The first stage is the primitive stage.

The characteristic of this paragraph is that I have no idea. I don’t know why I buy stocks when I buy them, and I don’t know why I sell them when I sell them. The decision to buy or sell is entirely driven by the impulse of others or oneself. For example, if a certain stock critic recommends buying this stock, he will think that the stock will rise at least 10 points, etc. There is no rules when it comes to selling. You can sell it if you think you can make money. Following stock reviews, listening to news, and reading newspapers are the main basis for trading. I remember there were no computers at the time and I had to buy newspapers and magazines every day. Securities newspapers and magazines are also extremely expensive. At that time, there were Shandong Securities News, Southern Securities, etc., which mainly looked at K-line charts, as well as stock reviews and recommendations. It is a common phenomenon at this stage that stocks fall when you buy them and rise when you sell them. After making money, you will be happy, but after losing money, you will be depressed, scolded, and regretful, and then you will follow the stock reviews and listen to the news.

New investors have two distinctive characteristics: first, they are not greedy; second, they are not afraid.

"Not greedy": As long as they have a little profit, they will quickly sell their stocks to make a profit. "I bought 500 shares at 10 yuan yesterday, and today they have risen to 11 yuan. Sell them quickly. You can buy a lot of food with 500 yuan." As long as the price of the stock rises above their buying price, every nerve in the body will Everyone is shouting: "Sell! Sell! Sell!" What should I do if I'm afraid it will fall back tomorrow? They are not greedy and are content with making small money. "Don't be afraid": What if unfortunately the stock worth 10 yuan a share drops to 9 yuan? The answer is: "What a pity. I'm stuck. Let's wait until it rebounds." Don't be afraid if you're stuck. I'm not in a hurry to use it anyway, so I'll just wait. "They are not afraid when they lose money, and they never want to lose a small amount of money. Covering it to death is the only way to deal with losses, and it doesn't matter how many years it takes. A eldest sister next to me covered a "Dalman" bought for 9 yuan until it was picked off. I entered the tertiary market. I remember that the night before this stock was delisted, she called me to ask me what to do if this stock was delisted tomorrow. Later, I checked this stock again. The price of the stock on the Third Board is around 0.50. It is quite regrettable that from my observation, more than 80% of investors cannot graduate from this stage. Ask yourself, if so, do you have such a mentality? The road to learning stocks is still long. You are still in the primitive stage. The typical mentality in the first stage is as follows

The second stage is the basic knowledge learning stage

The stock and futures market. There is not much knowledge. As long as you work hard, you can probably learn about stocks and futures in one and a half years. Therefore, it is very easy to get started with stocks and futures. However, this is only the initial stage of learning. I am very familiar with various analysis methods, especially technical analysis such as MAcD, kdj, rsi, DMI, etc. I think I have mastered the short-term treasures and can be victorious in the market, especially short-term operations, and some have studied them. It's 5 minutes and 1 minute. Doing this in the short term is as addictive as smoking cigarettes. I can't do without the market every day. I do analysis and prediction all day long.

After completing this preliminary learning, many people come to the conclusion that stocks and futures are easy to operate. The performance of this stage is: starting to use the learned indicators to select stocks, and enthusiastically explain technical analysis to everyone, I started to manage money for clients and provide guidance on operations. As you can imagine, losses followed. After being trapped for half a year, my friend joked that you just buy and don’t sell at this stage. You don’t know what to do. What to do, under the influence of stock commentators and stock friends, they are enthusiastic about short-term trading, but if the short-term fails, they will change to the mid-term. This shows that the awareness of stop loss has not yet been formed. There are still too many things to learn in trading, and the difficulty may not be less than the difficulty of making profits in trading. This difficulty makes many people only persist in learning for a period of time, and then they are in a state of letting nature take its course for a long time. Give up the opportunity for further study. Time is a major factor, and your subjective attitude is also a factor. Being able to maintain an optimistic attitude, etc. In fact, this is not something that anyone can do. To be honest, many people cannot change from quantity to quality. If you want to succeed, you must start from a student. To become a worker, then to become a master, every step is indispensable. If you want to become a professional and earn wealth in the market, you must have enough. Mental preparation. This stage took me 4 years from 1996 to 2000. Thinking about it now, I don’t have many memories of those 4 years. I vaguely followed the trend of the market. There was no trading plan, no speculation on the general trend, and no concept of stop loss. There were only self-righteous operations and Yelang’s arrogant guidance of others. Big bull markets also suffer losses. When encountering a bear market stock market crash, huge losses can sting the vanity and baptize the soul. You must go through the third stage, the confused and confused search stage.

The third stage: the confused and fumbling stage.

I spent 4 years at this stage, going through the process of the stock market turning from bullish to bearish in 2000. I worked tirelessly to learn a lot of things. I studied all kinds of indicators that I could learn. What? "Short-term is silver", there are a lot of books on investment such as Buffett's, it seems that everything needs to be learned, and it seems that learning nothing is useless.

Use fundamental analysis to trade stocks, study stock earnings and company asset values, and study cost-benefit ratios; I have carefully studied various technical indicators. But when I applied it, I found that they were contradictory and I was confused. I look for useful indicators while discarding suboptimal ones. I have learned a lot of technical knowledge such as wave theory, Gann theory, Buffett investment, Soros reflexive theory, etc., which has consumed a lot of time, money, and confidence. You can imagine how hesitant and torturous this is. During this period, I read the family precepts to the point where I could recite them backwards. In practice, it seemed that they were completely ineffective, and the operating losses just did not improve. Then look for new techniques and keep losing money, losing money, but just can't see any profit. This stage is very confusing and confusing, has a great impact on the confidence in stock trading, and is very complicated and painful psychologically.

The characteristic of the exploratory stage is that you have more or less understood the rules of stock trading. You know you need to stop losses and let profits run, but you don't know yet how to stop losses. You use mechanical methods such as 10% or 20% to set the stop loss point. Sometimes you can do it, and sometimes you find ways not to stop the loss. When letting profits run, you don't know how far you should let them run, and you don't know how to determine the profit point. Various rules for stock trading are sometimes effective and sometimes ineffective, and you don't know how to apply them selectively. When you see reckless speculators, you already know that they are acting recklessly, and you know not to do that. Sometimes you make money, sometimes you lose money, but you still don’t understand why you lose money, and you don’t know how you made money. You don’t have systematic buying and selling points yet. The cost-benefit ratio of this stock is very low, the dividend of that stock is relatively high, Zhang Securities recommends this stock, and Li stock reviewers are optimistic about that stock, but you are still using your own Intuition coupled with "can't go wrong" reasons for buying and selling stocks. Do these descriptions fit you? If it’s right, you’re still figuring it out.

After a large number of failures and setbacks at this stage, I no longer have the confidence to manage finances and guide others on behalf of clients, and my risk awareness has been strengthened. Many people give up studying and stay away from the market because they see no hope. And those who have faced countless setbacks and still face themselves bravely and never give up have spent nearly four or five years and gained nothing. They lost their capital and gained a lot of experience. A belief told him that if he left his job and found another job, these experiences would be worthless. You can imagine how unwilling he would be. I survived this disheartening stage, that is, I survived the big bear market from 2000 to 2004, and entered a new stage of self-reflection, self-denial, and starting over.

The fourth stage of self-reflection

After several years of confused and confused exploration, you often have to lose a lot of money. If you don’t lose a lot of money once or twice, you won’t understand what risk is. , you can’t graduate yet. Only when you lose money so much that you can't eat or sleep, will you truly reflect on whether what you have learned before can be used. Are your trading skills correct? It was at this time, in early 2005, that I felt that there was a technical bottleneck that I couldn't overcome.

If the experience of losing a lot of money occurs in the primitive stage of recklessness and ignorance, there is nothing to complain about, but if it occurs after several years of stock trading experience, it is necessary to study stocks and its If you have worked hard to exercise regularly, losing a lot of money at this time is often the last test before you succeed. Please don't give up! Those famous stock traders usually experienced one or even several bankruptcies before they became "homes." I remember an article saying that in order to train a trader on Wall Street, he needs to experience two bear markets and two bull markets, and he needs to lose US$2 million. When you can't bear it any longer, bear it a little longer. The dawn of victory will always come. At this stage, we really need a kind of spiritual support, the support of friends who share the joys and sorrows, and the guidance of a teacher.

After several years of losing money, I learned from the experience that I had learned too much and superficially. I learned that the reasons for my serious losses were:

1. Over-financing Expanded losses. Without reaching the sixth stage of long-term, stable technology model, profit model and profitability, financing is equivalent to putting yourself on the edge of the cliff. Do things beyond your capabilities, and danger awaits you.

2. Short-term operations are another reason why I lose money. For me, short-term operations are synonymous with unstable mentality. If you lose money, you want to make up for it immediately. You enter and exit in an unorganized manner, and you trade without a plan. When there is an adjustment, you will panic and stop the loss. Stop loss again and again, cutting off too much capital and confidence. The stocks that were originally promising in the mid-term were disrupted by short-term trading in and out, causing them to miss the market and catch up to the peak. Stop loss has become the main task. Gradually, I understood this truth. Too many operations are blind actions. Blind actions dissipate our energy, delude our minds, and wear down our money.

3. The third reason for losing money is that there is no trading plan. Various indicators were used to guide the operations at each stage, so the indicators were contradictory and the mentality was very confusing. It was at this time, in early 2005, that I felt that there was a technical bottleneck that I couldn't overcome no matter what. I had learned everything I needed to learn. At that time, I didn’t know that to break through this bottleneck, I needed to build my own trading operating system.

4. Did not learn from the teacher. The reason why I spent several years at each stage is mainly because I groped behind closed doors. Blindly believing in my own self-learning ability will inevitably lead to many detours. How important it is to find a good teacher.

So I learned indicators and wave theory again.

Select 2-3 methods that suit you, conduct in-depth research, and spend 2 years working hard to correct some problems. During this period, you have successfully selected bull stocks and mid-line operations several times. Although you cannot win for a long time, you can still win. I learned how to wait for the technical graphics I needed to track a stock for more than half a year, and regained confidence.

The fourth stage of self-reflection revealed these truths:

1. Forming your own trading style and establishing your own trading system is a sign of a mature investor. Do the right thing over and over again, it’s that simple! In this way, victory can be known in advance. Building and validating a trading system is also a long process, a reflection of your successes and failures over the years.

2. Only insist on making investments that comply with investment standards. Spend your time and energy looking for high-probability events that meet the standards, have the patience to wait infinitely, ignore anything that is unqualified, and say "no" to opportunities beyond your capabilities. There are many opportunities, but only a few belong to you. Seize the opportunities you can seize and do what you can do.

3. If you don’t take action easily, you will definitely win if you take action. Don't trade rashly and cut off positions that you don't have a plan and confidence in. If you don't take action easily, you will definitely win if you take action. If you are not 100% sure, then continue to wait and see. Or simply take a break. You are not afraid that the opportunity will not come, but you are afraid that you will not be able to seize the opportunity! Looking for the best trading opportunities in the market and waiting for opportunities you are familiar with is the beginning of successful operations.

4. Do not make any transactions without security protection. The position can be closed immediately when the stop loss is reached. This is good trading habits and a sign of maturity. Trading without a stop loss is like not wearing a bulletproof vest on the battlefield. Disasters can strike at any time. A timely stop loss will save your financial career and create conditions for not being eliminated by the enemy, because prices change all the time, and our emotions often change too. Change accordingly. Stop loss is relatively static and controllable. The controllability of stop loss can help us maintain a good mentality.

By recognizing these problems, there is hope for getting through the fourth stage. Investors who can survive the fourth stage will enter another state, where they can form their own trading concepts, their own trading models, and even their own trading philosophy.

The fifth stage is to establish your own trading operating system

Entering the fifth stage, your thoughts and transactions have formed a system. However, investors who have entered this state can only make temporary profits, and they are not yet able to make sustained and stable profits. Investors at this stage follow a complete and comprehensive operating model when operating. It can make operations orderly, maintain an independent investment personality, act in accordance with predetermined operating guidelines when trading, advance and retreat in a measured manner, and be calm. Therefore, a set of operating modes that suits you is an indispensable cornerstone for investors' success. It is also a sign of investor maturity.

A feasible trading system cannot be imagined out of thin air, it must be well-founded. To design and improve your own trading system, you must go through the following steps:

1. Solve the analysis basis for different cycle bands; the basis for judging various market states; the basis for judging buying and selling points ; The basis for holding shares is the basis for judging top and bottom. The solutions to these problems are the result of years of testing basic knowledge and the accumulation of experience gained from losses. Designing an effective trading system is an upgrade of trading technology, indicating that it has broken through the technical bottleneck and entered a new stage.

2. After the trading system is designed, there is still a long process of modification and market verification of effectiveness. Without a few successful cases, the effectiveness of this system cannot be determined. This verification time is at least 2 years. With a trading system, you cannot fully utilize its stable profits, because it takes a long time to develop absolute confidence in the system, master all aspects of the trading system, and practice the system's execution capabilities. During the system modification and verification process, you will find that you often circle around some problems, such as using this parameter for a period of time, changing the parameter for a period of time, and then changing it back to the original parameter, repeated many times. This is a sign of immaturity in the system.

3. After going through the verification process, I gained confidence in the system, and then practiced the system’s execution capabilities. If this step is successful, the trading level will reach another level, reaching the sixth stage: Have profitability. The study of stock and futures markets really begins in the fifth stage. The first few stages are equivalent to basic courses, and only in the fifth stage does professional courses begin. You have just started to learn skills. There is no end to learning skills. The continuous improvement of skills is the basis for you to maintain profitability. Improving ability is far more difficult than mastering knowledge. Profitability depends on ability, not knowledge. So the operation mode has been established, but it has not been successful yet. It requires a period of training on the execution ability of the operating system. The length of training time cannot be judged, it all depends on personal understanding.

After investors reach this stage, they will form their own system: mainly technical or basic. The characteristics are: being able to find bull stocks, and being able to describe the target position and wave pattern of the stock, and make an investment plan, but often cannot withstand short-term fluctuations and all previous efforts are wasted. There are also bull stocks that have been tracked for several months, but they failed to enter key positions and missed opportunities again and again.

The road to simplicity

Reborn

The sixth stage: having the ability to make profits

The training of the execution ability of the trading system is the sixth stage The main tasks of the stage. Ability can be divided into: market analysis ability, understanding of market performance, judgment of market status, identification of leading factors affecting the market, interpretation of technical icons, operation plan formulation and execution ability. Trading confidence is built. Any knowledge can only be transformed into one's own abilities through digestion and absorption through one's own specific practice. Market status, technical chart analysis, operation plans, etc. are all included in the trading system. Whether the trading system is reasonable and effective is the key to cultivating profitability. Because the specific manifestation of the cultivation of these abilities lies in whether strict training of the execution ability of the trading system can be carried out. Strictly implementing a trading system can build confidence and overcome fear. The question is how to build unshakable confidence? The process by which we trust ourselves is similar to the process by which we trust others. If others always do what they say they will do, we can trust them. Likewise, the more we stay true to our goal of becoming a successful trader and always follow our trading plans and rules consistently, the more we can believe in ourselves. By formulating a feasible stock trading plan, as long as I follow this plan, I will win if I bet for a long time. The only difference is that you win more and you win less, which has something to do with luck.

We can do this exercise: adopt a simple and clear trading system, set such a goal, and when the trading system gives a buying and selling signal, take action immediately without hesitation, regardless of your own heart Why are you hesitating?

The criterion for success at this stage is: starting to make stable profits.

We need to develop our trading skills one by one. When we are confident that we can control losses, we train ourselves in the skills of executing trading orders. We then retrain on techniques to increase profits, and so on. The cultivation of profitability also requires a certain amount of practice. The success of cultivating profitability depends on three states:

1. A record of continuous profits for more than half a year

2. A record of persistent use of the trading system

3. Correct analysis and records of reasonable transactions

Qualities possessed by those who have reached the sixth stage of success:

1. Integrity. To learn to invest, you must first learn to be a human being. Your attitude towards life will be faithfully reflected in your investment activities and form your investment philosophy. Hypocrisy and deception are the most taboo in human beings. If you deceive others in life, you will deceive yourself in the market. Integrity is the golden key to success.

2. Have a peaceful mind. There is a saying in Buddhism: Hui is born from awareness, awareness is born from freedom, whether it is birth or non-birth. It means that only when a person has a peaceful mind can he be aware of all things in the world, and only by being aware can he produce wisdom. This shows that a peaceful and simple mentality is the basis for success.

3. Perseverance. In futures investment, it is inevitable to encounter difficulties and setbacks, but excellent traders always know how to stick to their own trading system and never give up because of one or two setbacks. Because they understand that the final winners are not the smartest people, but those who can face themselves bravely despite countless setbacks.

4. Know how to wait. There seem to be many opportunities in the stock and futures markets, but in fact there are only a few opportunities worth investing in. Most of the so-called opportunities are "traps". We should calmly wait for those investment opportunities that can be grasped by us.

5. Know how to give up. One of the reasons why a failed trader fails is that he wants to seize every opportunity in the market, while a successful trader only needs to seize one or two opportunities. Some people say that people who understand know how to give up, people who are sincere know how to sacrifice, and happy people know how to transcend. This is the true meaning of life and the true meaning of investment. Whether in life or in trading, successful people must be those who are open-minded and know how to detach.

In stock and futures investment, success is not simply a skill or knowledge, but an excellent quality. This quality is not something you are born with, but is developed slowly by starting from small things bit by bit. When you sow an action, you will reap a habit, and when you sow a habit, you will reap success

If the road is simple, man will conquer nature.

The seventh stage: "The state of mind comes from the heart", "Kung Fu lies outside the poem".

A sage said: "We cannot talk to the frog at the bottom of the well about the sea, because it has never left its small living space; we cannot talk to the cicada about ice and snow, because it has only a short life. "We can't talk about the wisdom of life with a proud and complacent person, because he has closed the door to accept wisdom."

At this stage, making money is no longer a problem for you. Improve your mood and perspective. Being well-informed takes investing to the next level. Your knowledge and abilities transcend the masses. You are a high-ranking and capable person.

Many people who have become rich in the stock market did not make money through temporary tricks, but maintained stable income through correct investment concepts.

For example, Ba Fengguan became the world's richest man through stock investment. He did not have too fancy skills in stock trading. He gave up market quotations, and even macro analysis and industry analysis, and only focused on the "intrinsic value of the enterprise." He was an expert in choosing enterprise investments.

Soros's "reflection theory" is based on his understanding of the basic factors of the market and his superb grasp of the speculative psychology, and has achieved success. Rogers traveled around the world to examine investment opportunities in each country. Few people can achieve this kind of investment mentality.

If the road is simple, man will conquer nature.