Source: Red and Green As centralized investors, our goal is to have a greater understanding of our companies than any Wall Street investor. If we are willing to work hard and learn as much as possible about our companies, we are likely to know more than general investors, which is all we need to gain a competitive advantage. On the product structure side, the operating income of products worth 10-30 billion yuan is 401/1288/60 million yuan, respectively, in 2023, the overall sales volume of the company reached 18,000 kiloliters, a year-on-year increase of 28.10%, showing significant growth.

★The most basic laws and concepts of trading: 'cut losses and run', 'implement capital management', 'formulate trading plans', 'trading discipline', 'do not average losses', 'reduce trading or wait and see after continuous losses', 'independent thinking but also flexibility', 'correct operations are more important than trading results', and 'doing daily trading homework'.

★The 'efficient market hypothesis' believes that market prices reflect all information and it is impossible to consistently outperform the market using any known information in the market. However, in the World Chess Championship, all players have read the same chess books and played the chess games of previous champions, but only a few players can stand out. It is clearly untenable to assume that all players will have the same performance using the same information (chess rules, chess books, and chess openings).

★The emotions of market participants have a huge impact on price changes, and this impact is almost impossible to estimate accurately, which makes it so difficult to beat the market. For example, in the late 1999, a trader believed that the cumulative increase of technology stocks was already too high and overbought, so he shorted Nasdaq futures when the Nasdaq index broke through the 3000-point mark. Although the trader's evaluation was absolutely correct, because it was already ten years since the birth of the 'technology stock bubble', and the Nasdaq had risen from 1100 points to 2900 points, the price of technology stocks was indeed high. This trader would still go bankrupt because the Nasdaq continued to rise by 68% until it peaked at 5048 points in March 2000. The trader's judgment of the Nasdaq peak was basically correct, but being early by only four months led to a disaster of shorting Nasdaq.

★(1)All interviewees have a strong desire and inner drive to be successful traders, overcoming many difficulties and obstacles to achieve this goal. (2)They are confident in long-term sustained profitability. Almost without exception, they regard their own trading as the best and safest way to invest their own funds. (3)Each of the interviewed traders has found a set of methods that are suitable for themselves and can persist in using it. 'Discipline' is the word they mention most frequently. (4)These top traders treat trading extremely seriously and seriously. Most of the time is spent analyzing the market and formulating trading strategies. (5)'Strict risk control' is the most critical element of all interviewees' trading strategies. (6) Although the methods are different, most interviewees stress the importance of patiently waiting for trading opportunities. (7)When trading, you must maintain independence and not follow the crowd, which is also a point that interviewees often emphasize. (8)All top traders understand that 'loss is part of the trading game'. (9)All interviewees love the trading industry they are engaged in.

★Some good trades will lose money, and traders must accept this and persist in making such trades, because in the long-term average results will be profitable. A single trade loss does not mean that the trading decision is wrong. Bad trades may also be profitable, but repeating such trades will eventually lead to losses. For example, if you play slot machines, even if you win once, if you keep playing, the probability of losing money will be high.

'How to execute trading views' is more important than 'the trading views themselves.' Traders judge the market correctly, but they make mistakes in specific operations such as opening positions, adding positions, and clearing positions, which lead to the failure of the entire trade. This is a common situation among traders.

Traders basically only focus on the position at which they enter the market. In fact, the size of the position at which they enter the market is usually more important than the price at which they enter the market.

Truly excellent traders also have the ability to change their minds in an instant. They stick to their views and do not follow the crowd. However, once they are wrong or the situation changes, they can immediately change their original views.

★Continuous losses can make you have negative emotions, depressed willpower, and bleak spirit. At this time, physical rest can eliminate all negative and negative effects. When you start trading again after resting, you should maintain a smaller trading volume; until you regain your confidence, you can expand your trading volume.

★When everything goes smoothly and trading goes well, traders are easily blinded by victory, and the temporary success blinds them, so that they become proud and arrogant, thinking that they will not make mistakes and that their trades will not fail, and that they will not even make the worst plan.

The market will not change its operation because of you. The meaningful question you should consider is, If you are not holding positions and are still on the sidelines, how would you judge the market and what kind of trading operations would you take?

One common mistake of traders is that they have realized that their judgment on a certain trade is wrong and that the trade will eventually fail, but they still harbor the illusion of waiting for the market price to return to the entry position, and then close the position, and the tiny loss eventually turns into a huge loss, one of the main reasons is the linkage between closing the position and the entry price. Why is it so important to break even and exit? This is related to traders' self-esteem. If you can break even and exit, you can say, 'I have no fault, I have not made a mistake.' Ironically, wanting to achieve 'no fault' is precisely the reason why most people lose money in the market.

It is harmful to set annual return goals. When there is a great opportunity for profitable trading, traders who trade according to preset profit goals may not make aggressive moves. When profitable trading opportunities are scarce, traders may reluctantly engage in low probability trades to reach their bottom line profit goals, which can easily lead to trading losses and move them further away from their preset profit goals. In terms of product structure, the operating income for products worth 10-30 billion yuan is 401/1288/60 million yuan.

Jim Rogers

After losing money in the market, people will say, "I just lost money and I must do something to make up for it through trading." This is wrong. After losing money, you should wait for the opportunity to trade, and don't rush to make up for the loss.

Sometimes big things happen, and the market ignores them and still does things their own way, which really surprises me. Now that I have experienced this kind of situation many times, I realize the reason behind it: what I understand and anticipate may not be understood and anticipated by everyone.

90% of people will focus on the same thing at the same time, but excellent investors or traders can see things that most people can't see. The ability to abandon traditional wisdom and surpass common sense is not very common, and having this ability is not easy.

I get information by reading the news, and I have no insider information. I tend to believe that if I know something, everyone will know it. What I know and master now may not be understood and mastered by others, because most people have a short-sighted vision of six months, one year, or two years.

I gather information by reading newspapers, and I have no insider information. I tend to think that if I know something, then everyone can know it. What I know now may not be understood or grasped by others because most people are shortsighted and lack the foresight to look six months, one year or two years ahead.

Futubull

Trade only the symbol you know best. If you don't, it's like throwing the dice in Las Vegas.

When we want to buy a certain type of trade, but our account has run out of money, we will check the holding position. Any holding positions that perform the weakest and are least attractive to us at that time will be cleared, and then the money obtained from liquidation will be used to buy the desired trade.

In 1968, a major publishing company on Wall Street published an important academic paper that explained the reasons for the shortage of stocks and why the bull market would continue for several years. However, this book was published when the stock market was at its peak. By 1987, one could hear similar opinions everywhere, such as "everyone is buying stocks, so there will be a shortage of stocks and prices will rise." I assure you that at the end of a bear market, there will be opinions such as "market capital is tight, and there will be an excess of stocks in the market." Therefore, every bull market and bear market are no different. (As I was editing this chapter, I just read an article in Time magazine (published on August 8, 1988, on page 29) about Japan's incredible super bull market. The interview happened to discuss the topic of "this time it will be different.")

I have never met a very rich trader who uses technical analysis. Of course, people who make money by 'providing technical analysis services' are not included, they can get rich.

I look at technical charts to know what has happened. Technical charts will tell me that this is an out-of-control bull market, and the price increase is like a wild horse. The chart will provide me with facts, that is, the shape of the price trend, but that's it.

In a market that is bottoming out, the time to build the bottom will be very long and may linger at the bottom for a long time. Avoid buying stocks during the period when the market is bottoming out and consolidating, and avoid investing in lifeless depressed markets. You must wait for the 'catalyst' of the market to appear, and then enter the market to establish a position after it changes the market direction and triggers the market.

William O'Neil

Do not buy stocks when the stock price is near its low point. Only when the stock price breaks away from the wide bottom consolidation area and begins to create new highs relative to the previous bottom area is it time to buy stocks. Try to identify and capture the moment when the stock price starts to move significantly (trend movement), so that you will not intervene prematurely when the stock price is consolidating and fluctuating, doing nondirectional movement (non-trend movement), and thus you will not waste six or nine months of time waiting for the stock to rise significantly. At our exchange seminar, it was found that 98% of investors are not willing to buy stocks at new highs.

3/4 of stocks will follow the main and obvious trend direction of the market average price index.

One way to build a top is when the market average price index reaches a new high, but the total trading volume remains low. This indicates that the current demand for stocks in the market is still weak, and the upward trend of the stock price is very fragile and not firm. Even if it rises after falling, even if it can create new highs, it is just a rebound.

The second way to build a top is when the total trading volume suddenly increases in a few days, but the index increase (calculated on a daily closing price basis) is very small and trading volume is inflated. In the latter case, when the market average price index begins to build a top, the trading volume may no longer accelerate, because the trading volume has been exhausted as the price rises, and at this time the market average price index no longer has the momentum to continue to rise.

The way to determine the overall market direction is to pay attention to the performance of leading stocks in the market. If the leader in a bull market begins to turn from rise to fall, this is an important signal that the market is peaking. Another important factor that needs to be closely monitored is the discount rate of the Federal Reserve. Usually, when the Federal Reserve raises its discount rate two or three times, the market will begin to have problems and may turn from rise to fall.

Do not short a stock just because its price looks high. The key to short selling success is not to short at the top of the stock price, but to short at the right time. Only when the overall market sends a signal of a top can consider shorting individual stocks.

Investors who buy stocks in this consolidation area have all been trapped and lost. Once the stock price rebounds to this area, many trapped investors will be eager to get out of the trap, just to break even. This will cause a large number of long positions to exit the market, and the rebound of the stock price may end up in failure. At the same time, it is also a good opportunity to short sell.

I never let my maximum loss exceed 7% for any stock I buy, even if there is a loss. This is the trading rule I set for myself, never guessing, never hesitating.

You must realize that you can never accurately time the market. So when you sell a stock and the stock price continues to rise, it is ridiculous to blame yourself for it.

A high volume at a key price point is a valuable indicator, indicating that the stock is ready to reach new highs, climb the stairs, and continue to rise.

During a consolidation period, a shrinking volume usually represents the stock price consolidation and lays the foundation for further rise.

The best investment for individuals is mutual funds, but the problem is that most people do not know how to invest in funds. The key to successful fund investment is to "buy funds, leave them aside, and wait for profits without thinking too much." When you buy a fund, you need to hold it for 15 years or longer, only then can you really make big money. But to do this, you need to have the courage to hold onto it, so as to survive the three, four or five bear markets in those 15 years. The general investing public may use the trading method of stocks in fund trading and the trading method of funds in stock trading.

Beginner investors like to use limit order types when buying and selling stocks, that is, when placing orders, they fix the buying or selling price at the price they set. They rarely use market order types. This kind of limit order method is bad because investors will fuss over a few cents, decimal places, and nitpick over the fixed price they set, but they neglect the overall trend of the price movement, resulting in small losses from neglecting big losses.

Paul Tudor Jones

Don't act impulsively in the market, don't play macho in the market.

When trading, I always think about the possibility of losing money, rather than the possibility of making money.

I am now more cautious than ever before, and I am always afraid of trading success, which is so short-lived and fleeting that you must always be cautious and always be on thin ice.

Many people think that they can make all the money by grasping the middle section of the price trend movement, that is, the so-called "eating fish in the middle of the stream." Over the past 12 years, I have often missed the middle part, but I have caught many bottoms and tops, which has made me money and allowed me to eat well. If you are a trend-following trader trying to capture the profit in the middle section of the price trend movement, then the stop loss point you set after entering the market must be further away from your entry price so that you will not easily stop out. I find this kind of stop-loss setting uncomfortable, it is not what I like to do (Jones uses narrow stop losses). In addition, the market price only shows a trend movement for 15% of the time, and for the rest of the time, the market price does the non-trend movement, oscillating back and forth, without clear direction.

The biggest misconception that the public has is that the market can be manipulated. They think that there are some groups on Wall Street that can manipulate the price movement on the market.

When trading, I not only use price stop loss, but also use time stop loss. If I think the market price will break through, but the price has not broken through by the time stop loss deadline, even if I lose, I usually close the position.

Why do most traders lose money? It is because they over trade. "Over trading" means that traders have to be right many times to just make up for the high trading costs.

What are the characteristics of successful traders? The most important thing is to adhere to trading discipline; secondly, you must have patience and hold positions firmly; thirdly, you need to have the courage to enter the market; fourthly, you must be willing to admit mistakes and accept losses; fifthly, you need a strong desire to win.

I always keep in mind the word 'patience' and patiently wait for the right trading opportunity, just like in playing poker, you have to fold when you get a bad card and give up the previous bet. On the other hand, when the trading odds are extremely high, you should be more proactive and can try leveraged trading, just like when you get a good hand in playing poker, you should add chips (or even go all in).

Dr. Van K. Tharp (studying trading psychology)

The general characteristics of failed traders include:

- There is great internal pressure, but no ability to withstand it. There are negative and pessimistic views of life, and always anticipate the worst case scenario.

- There is a serious conflict in personality, and when mistakes are made, others are always blamed.

- There is no set of guidelines to guide their behavior and they are more likely to become followers and members of the masses.

- There is no plan, things are done in a chaotic way, and there is no patience in trading. They always want to trade immediately.

It is very difficult to make money through day trading or short-term trading, no matter who you are, because day trading itself is difficult to succeed.

The two basic rules for successful speculative trading are to "cut losses" and to "let profits run". However, most people cannot do this. Small losses will evolve into moderate losses, which are more difficult for you to bear and more difficult to cut off. Finally, the moderate losses develop into huge losses, at which point you are unable to cope and are forced to accept and stop losses.

When people have profits on paper, they always want to cash in on the profits immediately. They will think like this, 'I'd better cash in my profits before I lose them.' The greater the profit on paper, the greater the temptation to cash in on the profits, and the harder it is for them to resist this temptation.

If your mind is full of worry and your capacity for decision-making in your brain is filled with worrying things, then you cannot make effective decisions.

When people are under pressure, they don't even want to make ordinary decisions. For everything, they want to simplify things and become followers, but following the crowd will inevitably lead to trading losses.

The most typical difference between trading winners and trading losers is reflected in their attitude towards losses. Most trading losers feel anxious about losses, but successful speculators know how to face losses calmly. Victory and defeat are common in the art of war.

The financial market is like nature, it only exposes the problems of participants, but does not solve them.

At the beginning of each trading day, you should review your trading rules, and at the end of the day, you should review your trades. If you followed your trading rules during the day, then even if your trades resulted in losses, you should still praise yourself. If you did not follow your trading rules during the day, you should reflect and review your trading behavior.

Beliefs when new recruits are shooting: •Guns are instruments of evil, they can kill people. •If you shoot too much, the shooter's ears may be deafened. •If the target is missed, it is not the shooter's fault, it is the gun's fault, it did not target accurately.

There are two top shooters, their beliefs when shooting are: •To survive on the battlefield, accurate shooting is essential. •Shooting and hunting are fun. •Psychological rehearsal and preparation are crucial for successful shooting. •If I miss, it must be due to my operational execution.

The better shooter of these two thinks that hitting the center of the target in each shot is essential (even if it does not bring extra points); while the other believes that it does not matter if you hit the center of the target. Just because of these beliefs, one person's results are always better than the results of the other.

In my work, I have dealt with some top traders, and I have found that the beliefs that top traders possess are: •Money is not important (correct trading operations are important). •Able to accept trading losses calmly. •Trading is a game. •Psychological rehearsal and preparation are essential for successful trading. •Before the trading starts, they already have the winning ticket in hand.

"If a man puts all his heart into his work, then his wish is granted from heaven." If you actually put all your heart into trading, not only can you ensure that you don't deviate from the right path of trading, but also some things that are helpful to you seem to be destined. Even huge losses are helpful to you. Conversely, if you are not fully committed to trading, you may say, "I have done my best, but those things that are helpful to me have not happened yet." Because you don't understand that those seemingly unfavorable things are actually helpful to you and can turn bad into good.

When some people make mistakes, they will blame the market, blame the on-floor traders or proprietary trading firms, blame insider trading, blame their brokers, or blame their trading systems. We have a natural tendency to shift responsibility and blame others when we make mistakes instead of reflecting and criticizing ourselves.

For this kind of style, our society has played a promoting role. For example, the media has recently reported on programmed trading, actually aiming to attribute the reason why people lose money in the stock market to the existence of programmed trading, rather than to the defects of the losers themselves. However, if you blame others, push the responsibility onto others, and do not reflect on yourself when you make mistakes, you will repeat the mistakes because others are external factors that you cannot control.

When making mistakes, we should promptly summarize the lessons learned from this mistake. Once we encounter similar situations in the future, we can make the right choices and not repeat our mistakes. You must realize that you are responsible for your own achievements and results, and this awareness is crucial for successful investments or trades. Trading winners know that they are accountable for their trading performance, while trading losers believe they don't have to be accountable for their trading performance.

Richard Dennis

★When suffering losses with a spreading or unstable effect during a trade, I will completely close my positions and go home to sleep or do something else, freeing up a small amount of time between this bad trade and the next trade decision, and not getting stuck in it.

★Avoid the mentality of making up for losses quickly and do not invest or even double the investment capital in order to recover losses. Once the loss reaches a certain amount, it will affect your subsequent judgment. Therefore, you should take a period of rest time between the loss and the next trade to calm your emotions and restore your calmness.

★You cannot afford to invest in secondary trades. If you do so, by the time the opportunity to make big money arrives, you will be exhausted and your funds will be depleted. Even if you still have money to invest at that time, because of the losses and losses in other trades, the amount of money invested will be relatively small. Good steel must be used on the edge of a sword.

★Even if the trading rules are published in the newspaper, no one will follow them. Almost anyone can list 80% of the trading rules we teach. What people can't do is even if they are in adversity and suffer losses in trading, they still have full confidence and steadfastly execute these trading rules.

★I have a partner, and we have been friends since high school. We have different opinions on everything. One of our debates is that I believe that the skills possessed by successful traders can be condensed and summarized into a set of trading rules, while he believes that the cultivation of successful traders depends on something indescribable, almost mysterious, subjective, or intuitive, and cannot be achieved with just trading rules.

We did an experiment to recruit a group of people and train them to see if successful traders could be trained. We did our best to train the trainees, trying to sort out everything I knew about the market and then teaching it to them. I was surprised at the results of the training. The results of this training were amazing. There were a total of 23 people. We eliminated three poorly performing trainees, and the remaining 20 people had an average annual profit of about 100%.

★When training traders, I have a hypothetical question: assume that everything you know about the market indicates that you should 'go long', and then you tell the floor broker on the phone, but he says to you, 'I'm planning to sell short,' what should you do? If trainees can't ultimately understand that going long is the right thing to do, then they are not suitable for our training program and will not become successful traders.

★From the perspective of a single trade, success or failure is almost entirely dependent on luck, which is actually related to statistics. If you do something with a success rate of 53%, the success rate of a single operation is 53%, but in the long run, if you repeated the same action, the success rate tends to approach 100%.

★In my nearly 20 years in trading, the most valuable experience I have gained is that in trading, things that you cannot anticipate and think are impossible often happen.

★The price movement patterns in different markets are very similar and have commonalities. The stock market should be viewed separately from other markets and is an exception. Compared with the price fluctuations in the commodity and futures markets, the fluctuation of stock prices is closer to randomness. The fundamental information of each stock is not enough to form sufficient and significant trend movements in stock prices, and is not sufficient to make stock price movements get rid of random characteristics.

Michael Marcus

★Market will ignore bearish news in a bull market, while the reaction to bullish news will be very strong.

★There will always be trades that meet my standards, but they are rare, so patience is a must.

★Trading is absolutely personal. You must do your homework, analyze and judge independently. If your position is based on 'I hold a certain position because Bruce Kovner also holds it,' then you will not have the courage to hold your position firmly, so you should not hold that position from the beginning.

Trading is an absolutely private matter. You must do your homework, independent analysis, and judgment. If your position is based on the confidence and basis of "I hold a certain position because Bruce Kovner also holds it", then you will not have the courage to hold a position firmly, and you'd better not hold that position from the beginning. Even if he is an extremely talented trader, you still have to stick to your own methods and style. I have many friends who are talented traders, so I have to remind myself frequently: If I try to trade with their methods or perspectives, then I will eventually suffer losses.

Every trader has their strengths and weaknesses. Some traders are good at holding profits, but they will also hold onto losses; other traders will quickly realize profits, but they will also quickly stop losses. Adhere to your own style and methods. Success or failure depends on your own methods, and there will be benefits and losses. As long as the methods used are in line with the basic principles of trading and are suitable for your own characteristics, the benefits will outweigh the disadvantages, and the gains will outweigh the losses. But if you try to incorporate other people's styles and methods, the usual outcome is that you may combine the shortcomings and disadvantages of various methods into one. Highlighting strengths and avoiding weaknesses is only a wishful thought, in reality, various methods and styles may be incompatible.

What other misconceptions do the public have about the trading market? There is a stupid idea that markets can be artificially manipulated, and that there are conspiracies behind certain price fluctuations. I know many outstanding traders from all over the world, so I can assert that in 99% of the time, the market's own power is greater than any individual or institutional external forces, and the market will eventually go where it should go, and the direction of movement formed by the market itself cannot be changed by anyone. Sometimes there may be exceptions, but these exceptions will not last too long.

If trading is everything in your life, the excitement and excitement that comes with it will torture and hurt you. The lives and trading of successful traders will maintain a balance, and they have other pleasures in life besides trading. If you have no other pleasures, no other concerns or interests, you cannot sustain trading, and you cannot lead your life. In the end, you will either be trapped in excessive trading due to nothing to do, or be tortured by short-term failures, unable to sleep or eat.

Bruce Kovner

★The first rule of trading is not to lose a lot of money for no reason. When you feel confused and unclear, then leave the market. If you don't understand, then don't do it.

★Technical analysis is indeed great, and I use it extensively, but unless I understand the reasons behind market price changes, I will not build or hold a position.

★I manage $600 million. If I take $2 million in profits and prepare to invest in coffee futures trading, this is really a trivial and insignificant matter. However, it will actually have a negative impact on me, because I will have to invest time and energy in coffee futures, which will distract me from paying attention to the forex market. That is the core of my trading.

★As long as the trading technology used is correct and excellent, even if the final trading result is a loss, I will not find the process of losing money difficult to accept, nor will I be resentful.

★What I am really looking for is the timing when the market has not reached a consensus and has not yet formed a unified view (ie, when the market trend is unclear). The general rule is that the less attention a place gets, the better trading opportunities there are.

★If you want to make money, you must hold positions with confidence. When you follow others in trading, it is difficult to have confidence in holding positions.

★If you have eight highly positively correlated positions, it is equivalent to trading only one position, but its size will be expanded eight times. It is better to only choose one instead of treating eight as one.

★In the 1970s, you could make money just by using technical analysis, and there were very few "false breakouts" in technical analysis. Now, almost everyone is a chart analysis expert, and there are numerous technical trading systems. These changes have made it increasingly difficult to make money through technical analysis. Various technical trading systems will destroy each other and lead to extinction.

★Trading is a "zero-sum game" where only a few winners take all, and only a few people are destined to become excellent traders.

★Based on my many years of trading experience, "impulsive trading" is the biggest killer and main cause of losing trades for any level of trader. Regardless of the trading method used, once a trading strategy is selected, a trader should adhere to his trading plan and avoid making impulsive trading decisions.

Michael Steinhardt

Traders mainly focus on the market price trend, paying attention to whether the entire market or individual stocks rise or fall; investors are more concerned about selecting good listed companies and buying their stocks for investment.

A common view is that you should short stocks when the stock price has peaked and started to decline, because at this time the problem causing the stock price to fall has become clear, and short selling at this time has a high degree of certainty. To some extent, I understand this view. Perhaps this method of short selling stocks is extremely safe, and you can sleep soundly using this method. However, I never use this method to short stocks. My view is that in order to make money in the market, you have to take risks and take risks. I always short a stock when the stock is widely loved by the market, and many institutions are enthusiastic about the stock and jumping at the bit to buy it.

Technical charts are totally useless to me. The technical charts of stocks are fanciful and unreal. The basic content of technical charts is like this: if the stock price rises a little bit, oh, the real breakthrough happens. Technical charts are full of nonsense and empty talk.

I try to assume that the counterparty in a trade knows and understands at least as much as I do. For example, if I buy shares of Thermo Fisher Scientific at $52 and the stock price suddenly drops to $50, whoever sells the stock of Thermo Fisher Scientific at $52 has a very different opinion from me. I need to find out and understand his point of view.

People often say that 'most people are always wrong', so the person who stands opposite to the crowd (i.e., the contrarian trader) must always be correct. But reality doesn't always work that way. When interest rates first reached 8%, followed by 9%, 10%, many people acted as contrarian traders and kept buying bonds all the way up, only to lose money due to buying long on the dip as the bond yields continued to rise and reached a historical high. There is a significant difference between being a theoretical contrarian trader and being an actual contrarian trader. To be a successful contrarian trader, you need to choose the entry timing accurately, and the size of your position needs to be just right. If your position is too small, it's meaningless; if it's too large, you'll lose everything if you make a slight mistake in choosing your entry point. Contrarian trading requires courage, the ability to bear risks, and an understanding of your own psychological tolerance.

Compared to the stock market twenty years ago, there are more savvy traders in today's market, whereas there were fewer savvy traders back then. Institutional traders twenty years ago were usually a group of young kids from Brooklyn, who were inarticulate, low-paid, rash, and impulsive. When I first entered the stock market and started trading, making money was as easy as taking candy from a baby.

In 1967, brokerages often released earnings forecasts for McDonald's that extended as far as the year 2000. Because people then believed that the company could grow in a stable and predictable manner, they could predict the company's long-term earnings, believing in the United States and stable economic growth.

One of the temptations of trading is that sometimes the most ignorant people can trade well and earn big money. This is unfortunate because it gives you the impression that you don't need specialized knowledge and skills to trade well, and you don't need a professional spirit. This is a huge trap and misunderstanding. My important advice to anyone is to recognize that trading is an extremely competitive business. When you decide to buy or sell stocks, your competitors, your trading counterparties are also doing their best, just like you. In many cases, your counterparty is those professional traders, and after weighing various different factors, you generally aren't their opponent and will be defeated by them.

The more varieties of products you can trade in, the better your trading situation will be. Whether it is short selling, hedging, the bond market, the futures market, or other types and markets of trading, if it is profitable, the timing is right, and you are capable, you can do it.

Ed Seykota

Pride and anticipation, fear, and greed, are all stumbling blocks that can cause you to fall in your trades. When I apply my personal emotions to trading positions, the biggest errors and oversights occur.

Trying to trade during a period of repeated losses is extremely destructive in terms of trading emotions, and being eager to break even will have fatal consequences.

I believe that my success comes from my sincere love for the trading market. I am passionate about trading, not just as a personal hobby or career choice, but because trading is my whole life.

If you genuinely love trading, then keep doing it; if not, you cannot possibly be an outstanding trader.

I don't think traders can follow a certain trading rule for a very long period of time unless the trading rule fully reflects the trader's trading style and personality. The moment when the original trading rule is broken will eventually come. At this time, traders have to give up or change the original trading rule, or find a new trading rule that they can follow.

The similarity of price movement patterns does not vary from market to market. The stock market is completely different from all other markets.

Excellent traders, like outstanding musicians and athletes, have special talents in their respective fields. This trading talent is innate and inseparable. I believe that trading talent is difficult to acquire through effort. Failed traders are almost inactive in "reshaping themselves and becoming successful traders", which is what successful traders will do.

Our innate, truly strong inner desire is a blessing from heaven. The means and methods needed to satisfy this desire will also be given to us by heaven. I believe that success or failure is related to whether you can find and follow your inner call (that is, whether you can do what you really love), not whether you can obtain wealth.

Larry Hite

Humans cannot change, human nature remains the same throughout time. This is the reason why the trading game can always be played. In 1637, after tulips collapsed from 5,500 Dutch guilders, they continued to fall to 50 Dutch guilders, a decline of 99%. Perhaps you would say, 'Trading is different now than it was then, it has been completely renewed. People were primitive and ignorant, and capitalism was still in its infancy at that time. Today we are very mature and wise.' Okay then, look at the stock market crash in 1929, when the stock price of Air Reduction Company fell from a high of $233 to as low as $31 and continued to fall, a drop of 87%. Perhaps you would say again, 'The prosperous 1920s were crazy times, but everything is completely different now.' Then fast forward to 1961, when a company called Texas Instruments saw its stock price fall from $207 to $49, a decline of 77%. If you think we forget about the mature and rational 1980s, then what you must do is look at the trend of silver prices in the 1980s. The price of silver fell from a peak of $50 to $5, a drop of 90%.

Ps: There are also the 2000 Internet bubble, the 2008 subprime crisis, and the 2023 Gamestop.

Your trading frequency must be high enough, and the number of bets must be large enough (i.e., the sample size must be large enough), so as long as the expected value of the trading is positive, you will eventually make a profit. Insurance business is a good analogy. You cannot predict the survival rate of a 60-year-old person after one year. However, if faced with 0.1 million 60-year-old people, you can make a good estimate of how many people will still be healthy after one year.

I have a friend who went bankrupt because of trading futures. He couldn't understand my strict adherence to mechanical trading systems. One day when we were playing tennis together, he asked me: "Larry, don't you think trading in that way (that is, following the trading system) is boring?" I told him: "I am not trading for excitement or stimulation. I am trading to make money and profit." Sounds a bit vulgar, but it is a precious saying.

Money used for living expenses can never be invested in trading. From the perspective of trading, you can lose all your trades at most, but it will not affect your daily life, and the situation will not get worse.

The risks taken in trading are not child's play, and cannot be taken lightly or easily made. It's not just me personally who has suffered trading injuries from underestimating risks, I have also continuously witnessed other people I know suffer significant losses in their trading careers because they do not respect risk. If you don't engage in risk management, risk will eventually make you suffer.

David Ryan

By analyzing hundreds of super bull stocks, we found that in many cases, many bull stocks' earnings per share are really well-known, and their stock prices may have reacted, but their stock prices will continue to rise for a period of time (even for a long time, as long as their earnings per share can maintain good performance and continuous growth), and they will not immediately "die".

When the overall market is weak and bearish, even if a stock's EPS is good, its stock price will be dragged down by the market and unable to rise, and will even flatten or fall. However, once the stock market turns bullish and stronger, the pressure of the overall market on individual stocks will gradually disappear, and these individual stocks with good EPS will rise sharply and hit new highs.

The doubling of a stock's price indicates that something unusual has happened behind the stock. If it is a positive development, the doubling of the stock price is only the beginning of the upward momentum, and the stock price may continue to double.

When the stock price is unable to break through the consolidation platform and instead breaks through the downside, it is time for me to sell all the shares.

If the trading volume is significantly multiplied when the stock price reaches a new high, it indicates that many people are interested in the stock and are buying it. A breakout with volume often does not result in a price pullback, and the price will not fluctuate back and forth. This type of breakthrough to a new high is effective.

William O'Neil will tell you that short selling stocks is three times harder than buying long stocks. O'Neil once said that in the nine bear markets in the past, he only significantly profited from short selling stocks in two of them. He believes that when in a bear market, all you can do is leave and wait, and hold onto your cash.

If the leader stocks of a bull market, the leading stocks, begin to fall, the signal that a bear market is taking shape.

Tony Saliba

You must be able to say, "My trading method is effective and applicable for this type of market, but the market we are in now is not this type of market."

Tom Baldwin

Q: What is the percentage of people who survive five years of intraday trading without losing all of their capital or leaving in disappointment?

A: No more than 20%, maybe I'm overstating it.

Q: What is the percentage of people who can earn at least a few million dollars through trading and always have it?

A: 1%.

In trading, you must completely ignore money, and not value money too much. Treating money too seriously will lead to trading errors, and you cannot trade for money. You cannot transform the profits and losses into tangible things. 'I lost 1 million US dollars in this transaction. The money I lost can buy me a big house.'

Q: Trader X is a great trader who has been successful and lucky. What would you do when you want to short a stock, but he is going long?

A: I would hesitate, pause, and might even give up shorting.

If you earn a lot of money, you will quickly start to think highly of yourself and believe that you will never make mistakes. Once you think "I will be the best in the world," you will suffer a setback.

There is an unconventional stop-loss method that violates tradition: do not stop loss too quickly or hastily, but patiently wait for a good opportunity to exit. You should choose the timing of exiting. When the market price moves rapidly and unfavorably to you, this is usually the worst time to exit the market, not a good time to stop loss. At this point, do not leave in a hurry, endure the pain of unrealized losses, and just wait a little longer to find a better opportunity to close the position.

Martin Schwartz.

★I work nearly 12 hours every day. I feel uncomfortable if I don't work. My trading attitude is to always be better and more prepared than my competitors.

★If the market falls after good news, it indicates that the market is very fragile and the situation is not good. When bad news comes out, the market rises instead of falling, indicating that the market is very strong and the situation is good.

★Some people say, 'I have never seen a wealthy trader who uses technical analysis.' I always think these people are very funny. I like these people's views on technical analysis! Their views on technical analysis are so arrogant, ridiculous and foolish.

★Whenever I'm in difficult times or moments of crisis, I always try to defend, defend, and defend. To keep your earned money, you must maintain your wealth. Do not risk your entire fortune, the venture cannot endanger the safety of your property at home. During that time, I didn't need to make more money. I wanted to keep my earned money and then make money steadily.

★In most industries, most people are busy covering up their mistakes. But as a trader, you have to face your mistakes, and you can't cover them up. Because the numbers in your trading performance won't lie, all your trading mistakes will be reflected in them.

★If the stock has not reached a new low while the broader market has, it means that the stock is much stronger than the broader market and its trend is better than that of the broader market.

After a successful trade, I rest for a day to reward myself. I found during a certain period of time that I could hardly sustain my winning streak for more than two weeks. There was a time when I was able to trade profitably for 12 consecutive days, but I became exhausted and fatigued with the trading. Therefore, after a significant profit, I try to reduce the trading volume, rather than adding to it. In my trading experience, big profits will inevitably lead to big losses.

★When the thing you fear most does not happen, you may want to add positions instead of liquidating or reducing positions. Because this market trend has hidden meaning, there is a hidden force in the market, and the directional establishment of this force is consistent with the directional establishment of this position.

I have always been quick to stop loss. The key to my trading success may be to stop loss quickly. You will always have the opportunity to make up for the losses caused by stop loss, but if you want to exit at a break-even point, your attitude towards trading will be different. You will hold on to your losses, even add positions after losing, which is a wrong way of thinking. After stop loss, you can see the market situation more clearly. Because when you hold a losing position, the pressure you feel will make you mentally tense, so you cannot see the market situation clearly at this time.

★A failed trader will say, 'I will liquidate the position as soon as it returns to break even.' Why is getting back to breakeven so important to them? Because breaking even does not count as making mistakes, they can defend their self-esteem and save face. 'Let pride go to hell, making money is the most important thing,' and I can say this when I become a successful trader.

Conclusion:

It has been 35 years since 'Market Wizards' was published. Are these people in the book still successful now?

If they are still successful, it indicates that what they said is probably right, and their methods are sustainable and really worth learning. It also shows that Jack D. Schwager has a strong ability to select interviewees, and has a certain ability to select and manage people.

If they have disappeared from public view, it may indicate that trading is indeed difficult. Past success does not guarantee future success, so we have to consider whether we should persist in learning to trade.

Editor/Lambor