[Question] Short selling (contrarian) seems to end up losing in the end even if it makes a profit… can you make that much money? [Answer]

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A method to take both trend-following and trend-reversal simply by averaging in

【Question】

When it comes to counter-trend trading, I only have the image of losing at the end even if there’s some profit

Is it really that profitable?

I think it will end up being a slow grind to a bust

I’m curious because many people who heard from online acquaintances are losing money

I’m torn whether to choose a trend-following or a counter-trend trading strategy

I’m wondering if counter-trend suits me more

Please take care of me

【Answer】

Counter-trend trading can be profitable,

but that’s only in a short-term sense

It’s relatively easy to grow daily

The reason is that the market does not immediately move into a trending phase

Even if it does move, it tends to revert back with a high probability

And that “high probability” varies quite a bit depending on the timing

However, you can’t rely on that indefinitely

So, counter-trend is essentially a “battle with the big move”

The best attraction of counter-trend is the steady accumulation of profits

And the downside is taking a big loss in a single move

The people who can limit losses during those big moves are the ones who excel at counter-trend

In other words

Strengths and weaknesses are not inherent to you, but depend on

the act of decision-making

If you can choose the correct option in decision-making, you can limit losses with counter-trend trading and continue trading

If you cannot perform such trades

Then trend-following is easier for you

【Reply to the answer】

Decision making

I’m surprised as it’s not a common consideration

Indeed, if my own decision-making doesn’t align with that logic

it could be a waste of talent

Whether counter-trend suits me

I’d like to decide after trading with a smaller amount of funds

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