An article is published in Toyo Keizai ONLINE: The reason for retail investors' losses, and the shocking number one cause?

Good morning, this is Matsushita.

Yesterday's Dow Jones Industrial Average in New York edged up slightly.

How will the market adjust, in what shape will the correction take place?

Shanghai Composite Index continues to fall.

USD/JPY retraced to the low-110s.

NY Gold is up slightly.

Since the day before yesterday, newsletter readers' survey

for the “2017 Individual Investor Performance Report”

is being introduced and explained.

Makoto Investment School newsletter readers' survey

“2017 Individual Investor Performance Report”

Today, from last year's survey

we will look at newly added reasons for losses and gains

and analyze them.

First, the reasons for losses,

the first place goes to

“I can't control my mentality.”

This is indeed the main issue.

By the way, last year it ranked sixth.

“2016 Individual Investor Performance Report”

The money involved in investing

gives our brain a strong stimulus,

the brain responds directly, and emotions move.

In ordinary life,

there are very few opportunities to be directly stimulated by “money,”

but once you start investing, you are exposed to that environment

and investors become perplexed.

Many people cannot endure the mental and emotional swings,

the temptations and stimuli of desire and fear,

and are forced into inconsistent actions, resulting in losses.

Under constant stress, feeling anxiety and fear,

if you lose more money,

your motivation and drive disappear.

Unless you can build a stable mental state toward money,

you cannot continue to win in investments.

I have been saying this for 13 years.

Next, second place is,

“There are no rules, they are not established.”

This ranking is also understandable.

Last year it ranked first.

This year, sixth place also includes “impulsive, intuitive, emotional trading,”

and seventh place “unable to follow the rules,”

so if you consider all of these as “issues with rules,”

excluding the aforementioned mentality control,

it would be ranked first.

Individual investors have a permanent and decisive problem of “no rules.”

This is the issue they face.

And third place is,

“Cannot cut losses, or cutting losses is inappropriate.”

This is also a classic concern, and last year it ranked second.

No matter how much time passes, cutting losses continues to trouble investors.

Conversely, if you stop struggling with cutting losses,

a big problem disappears.

On the other hand, among investors who have made profits, the first reason for profit was,

“thorough money management.”

Since this answer shines as number one,

these respondents are, compared with the general individual investors,

likely highly diligent students of investing.

Indeed, money management is the most crucial factor that determines the success or failure of investment.

Like the aforementioned stop-loss,

if you realize this and practice it,

investing becomes considerably easier.

In a sense, the “winners” are investors who consistently

practice money management.

There are many other interesting and insightful responses

alongside, so please check them and compare with your own investment issues.

“2017 Individual Investor Performance Report”