1. Fundamentalism
Here I want to talk about two figures: Lin Yuan and Fu Haitang. What they have in common is: simple logic + grasping the general direction + extremely firm willpower to hold positions. They are not from financial majors, but they beat 99.9% of the talented people with majors. On April 15 this year, I was fortunate enough to attend Mr. Fu Haitang’s lecture in Chengdu. Mr. Fu’s wisdom and structure are beyond the reach of ordinary people.
He did not study technical aspects, but only emphasized the eight words "supply and demand relationship, law of value", and also made a joke: if you don't open for three years, you will have to wait for three lifetimes if you open. Although it was a joke, he really did it. What I want to say here is that not only the trading industry, if you want to succeed, you must learn to grasp the general direction and trend.
A real estate tycoon once said that those who have been engaged in real estate since the 1990s have made a lot of money as long as they did not land themselves in jail. This is the power of trends. In the stock and futures markets, there are many people smarter than you. Don't think about relying on your intelligence to design a method to make big money. People who make big money are those who can grasp the general trend.
Many people spend their time studying how to stop profits, trying to find a better way to stop profits. In fact, what I want to say is that many big guys just stop profits when they are embarrassed to make money. Lin Yuan sometimes expresses similar views jokingly. Recently, someone asked him about taking profit. Lin Yuan said: "There is no good way. After a stock of 10 yuan rises to 100 yuan, it will stop profit if it falls to 30 yuan.
" On the surface, it seems that the big guys are using stupid methods, but a lot of money has been made by these people. If you are good at grasping the general trend, then many of the problems you usually encounter will not be a problem. Just like when a person magnifies the pattern, he finds that many of the problems that bother him in life disappear on their own. Others include those who do mean reversion, those who do arbitrage, those who do certain fixed patterns, and even those who specialize in false breakthroughs. There may be unexpected styles.
The only thing they have in common is that when looking at their capital curves, they all encounter a bottleneck period (funds are stuck at the same level). At this time, many people are optimizing their methods or changing their styles. After changing, they find that the market is like a clever martial arts master who can always find your flaws and put you into a bottleneck period and a retracement period. So I think the method is almost enough, just like what Teacher Zuo Wei said: Be generous. You have made so much money, so why not let others make some?
Finally, let’s talk about the Livermore and Stanley Crowe factions. First of all, it should be noted that the style of this school is not suitable for everyone. People should choose a certain style based on their own advantages. For example, top students in programming and mathematics can choose quantitative trading, people with a spot background can choose a fundamental style and not do short-term trading. People with particularly good trading sense can stick to short-term trading if their winning rate has always been high.