Currently featured in Toyo Keizai ONLINE column: Riding the trend

Good morning, this is Matsushita.

Today, I will write about trends.

Do you know what a trend is?

What exactly is a trend?

Let’s write down your own definition of a trend in

the investment notes or investment diary at hand

and try it out.

Surprisingly, many investors have only a vague understanding of trends.

Because it is vague, they cannot ride the trend.

If the definition is clear, you can ride the trend.

I had been investing for a year and a half and

didn't know what a trend even meant.

I probably didn’t understand much of it.

So I was always in a downtrend,

sitting there while the money kept shrinking,

and I clung to it with no exit.

So my money kept decreasing endlessly.

Now, I would cut losses immediately, or

I wouldn’t enter at all in the first place.

But back then, since I didn’t know about trends,

I bought into a strong downtrend

and kept suffering losses endlessly.

If you ride against the trend,

your money will decrease rapidly.

However, once you learn to ride the trend correctly,

your money can increase at a tremendous pace.

That is what a trend is.

Around the second year after I started investing,

I crossed a clear boundary and began to ride in the direction

opposite to the trend,

but then I was able to ride in the same direction as the trend,

and the surprise at that time was intense.

Where money was decreasing at a tremendous pace,

it began to increase at a tremendous pace.

It is the difference between riding against the trend and riding correctly.

To ride the trend correctly,

it is necessary to define the trend.

If you can define the trend,

you will gradually be able to ride the trend.

To ride the trend correctly and increase your money,

let’s acquire the definition of the trend.