Category: Money tips Release Date: 2006-01-20
There is a principle investor must keep in mind: when things are likely to deteriorate at a time when a certain result is the worst! ! This is the famous Murphy's Law. For this rule to compare the image of the explanation is this: If the table has a piece of bread, bread with butter side. When the bread from a desk to fall to the carpet on the precious time, there must be some cream which face down.
Once joked with him and friends said, with Murphy's Law tests the basic quality of an investor is not qualified, is a good instrument. If you now have a trading system, the system is in statistical historical data, we found that you are up to five consecutive losses five times. So, you have a row after losing some 5 times, you should how to operate? If your answer is to increase operational positions. Then, "Congratulations," you answer wrong. The result is the correct position should be reduced. That is, you should first reduce the losses and start earning money.
Investors there are two core principles: one, be sure to control the deficit; 2, remember the first principle and, if violated, according to the first principle. Therefore, any time, once you start a loss, then the best strategy is to reduce positions. Continued losses and position continued to decline. Only you begin to profit, and in order to gradually increase the position.
This is not only required to comply with the principles of investment, even in life, it must abide by. Recently, a friend's status is poor, just to maintain life, in order to earn living expenses, need to spend two days without sleep buckle down to action individual and private living. Into this time, in fact, appeared on the big losses and investment, the same. I admonished him, we must live a good rest of the job done. After finally live done everything he wanted to reward yourself and friends to go shopping on the results wallet was stolen out of the ... ...
A lot of investors in the investment process that often appear in a similar situation. Ordinary investors a loss, a beginning also know how to deal with, but the unexpected losses, beyond the tolerance limits of psychology, it should be how to deal with it?
Irrational investors will often have two categories of action, the first category is to be aroused from the gambling features. This time, there will always be two consequences. Some people gamble on, so, the model must do to be his psychological models. However, there is always a time when he bet wrong. If it is leveraged transactions, it basically has been cleaned out of. The second option is to identify categories of people out losses. However, if this time to identify losses leave, you can also restore lost opportunities. Select departure should not be at a loss to get out of hand when it considered the risk must be controlled within the framework of decision-making.
The correct action should be what is it? Should be the first to reduce the amount of losses. And by continuously looking for profitable opportunities for micro-probing. Only in instances where their own is still profitable, and when the track before it can embark on the journey slowly.
Investment is a function of time is also long in long-distance running. So how does not want you to run faster, but how to finish the course. We often see a profit within a period of time high investors, Warren Buffett that 50-year 23% of the level of investment income, for many people, and nothing. But the global to do at this time, the results seem to only this one. Therefore, if you earn in 3 months, 500%, and will not necessarily succeed, it is important in the "long-distance race" and can also have a stable income. Would like to achieve this stable streams of revenue, we must abide by a principle: we must control the losses! ! When there are laws and run counter to this principle when the principle of compliance with the control loss. (Send
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