Category: Money Tips Date: 2006-10-17
Dialectic there is a classical theory, namely, universality and particularity of the law. This is qualitatively speaking, if we said that from the quantitative theory of probability.
Technical analysis (mainly graphical analysis) is actually empirical analysis, that is, the universality of things, a summary of the law.
The stock market there is no absolute, technically speaking, any type of graphics are not fully succeed at this path, nor does it completely go bad, but relative, that is, the majority of living well, or most of the other to go bad. From the probability theory sense is, What percentage of living well, or how many per cent to go bad.
I personally think that if properly take the probability of certain types of graphics are:
90%, bold all over the warehouse operation;
70% can be 1 / 2 or more operating positions;
60%, choose the situation, specific analysis, the amount of participation;
50% and below, not to participate.
The so-called 90%, or 10 stocks which have nine living well and making money; one go bad, lose money. Can I use a share of profits to compensate for the loss of another one stock, even if one is not enough, use two totally be all right, so there is only a net profit of 7 to 8 stick with it, one year, the profits will be very considerable.
The so-called 50%, or 10 stocks which have 5 to make money, five losing money, win loss offset, zero-sum game, stop-loss points if not properly managed, but will a loss. In such cases I do anything.
Some graphics are very special, even if there is an up very well, even if several-fold, but similar to other graphics, there may be nine have failed, this graphic is not universal, can not simply explain the problem, even if the money is also relying on luck. Of course, this method only from the individual stocks in quantitative terms, without considering gains and declines, considering the decline in inflation, the profit is quite substantial. If we take 10% stop-loss points, below the 10% of the operator failed this year but there is no maximum, since it is dark horse, or not only 10%.
