Don't waver when you're damaged!
If you don’t move a certain amount of money, there is no point in executing trades.
Even if you allocate 100% of 100,000 yen and pick a stock that would become tenfold (assuming you hold it for the full 10x), the profit is 900,000 yen. But if you have 10,000,000 yen available, even one-tenth of that—1,000,000 yen—becomes profit, making it easy to continue and sustain good results.
It’s like preferring to drive safely at a steady 100 km/h in a large passenger car rather than rushing at 100 km/h on a small motorcycle; you have more margin to pay attention to your surroundings and stay safe.
Nevertheless, you should not put an overly large amount into your trading account.
Even if it means reducing profits when things go as expected, you must rule out the possibility of taking a big loss.
If you imagine the amount you lose as piles of banknotes flying away, you may become emotionally unsettled and lose your way.
By planning with a reasonably cautious mindset, and then taking bold, intuitive actions within that plan, the overall balance will improve.
In trading, you must decide many things for yourself.
However, because you decided them yourself, changing them yourself is also easy.
What you must be careful about is the so-called “drift.”
If you say, “This didn’t work this time, so I’ll use this standard next time…” and keep changing things, the very standard by which you judged “it didn’t work” will disappear.
In statistics, you wouldn’t alter your business direction just because it rained for a period with few customers.
Yet, in trading, you tend to respond with such ineffective measures.
If you chase a “formula that makes profits easily,” you will make this type of mistake, so hardship is inevitable; you should seek a stance that doesn’t feel painful.
Since you must narrow your criteria and approach trading, it’s essential to have recognition and plans that prevent inevitable losing streaks from causing drift or relying on superficial fixes.
All of this is your own decision, so“Even if you lose, you continue”is one key to success.
Losing streaks are inevitable, so you must continue despite losses—this is the reality of trading. However, if the streak becomes too long or you don’t seem to turn profitable even after two, three years, you need a fundamental reassessment.
Judging whether problems are only recent or indicate a fundamental error is very difficult, but you should understand there are two different types of judgments, not simply “I lost.”
There are many factors to check: improper parameter settings, poor stock selection, bad capital utilization, poor stock combination, and more.
Considering all these comprehensively to build a method that lasts long is the true path of trading.
Among them, there are times when you must boldly change your approach.
To make the trading path proper and high-quality, it is essential to define an “ideal price movement pattern” and then recognize reality correctly.
Decide on a method, and examine not only its strengths but also its weaknesses.
It’s natural for individual investors to think freely and move forward, but freedom and drift have completely different meanings.
Hold a solid mindset and continue without wavering.
At the same time, don’t hesitate to revise your thinking through study.
■Stock Investment [Tiger’s Den] (Hayashi Investment Research Institute Channel)
On Friday, January 28, I uploaded the latest video.
Stock Investment [Tiger’s Den]
Stock Investment [Tiger’s Den] How to Escape Poverty through Stop-Loss
Even if you desperately try to predict the stock’s future, miscalculations are unavoidable. Therefore, an appropriate “stop-loss” is essential.
However, there are cases where losses accumulate too much from stop-losses...
The causes are elements that every trader possesses. This is content every investor must see!
■YouTube Channel Market Scramble
Tonight, the latest video for Market Scramble will also be released.
Please view at the URL below. Enjoy!
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