Category: Money Tips Date: 2007-05-31
Market will not always be located near the top or bottom. Generally speaking, in any market, bull market top and bottom of bearishness between a good professional speculators or investors should be able to grasp the long-term price trends in 60% to 80%. During this period, trading the focus should be placed on a low-risk consistency of earnings. Why? As far as I more than six years on the market statistics show that any top and bottom of the combined running time of no more than 20% of the time, market conditions, and the vast majority of not more than 12% of the time, we have many of these key statistics, this is our basis for the formulation of the entire investment plan. In other words, in this less than 12% of the time where you could easily fry or escape at the end of the top, most people, including professional investment funds can not do this.
To stabilize the capital increase, you must have consistency of profitability, but also to the need to safeguard your profits and minimize losses. Therefore, you must - to measure each of the decision-making the relationship between risk and reward in order to increase the consistency of the odds. Please be sure to keep in mind the above remark, it is almost all successful professional bodies ironclad operating principles, and only you have a deep understanding of the meaning of this sentence, you can enter the door to professional securities operations.
If I was a young, newly arrived to the speculators (domestic investors in more than 95% is such a person), and with 5 million yuan of funds trading A shares, my original position will not exceed the total capital of 20 % - 10,000 yuan - and set the stop loss and the potential losses will be limited to 15-20% among the living - between 1500-2000 yuan loss. In other words, under this design, I definitely will not exceed the total loss of venture capital of 3% to 4%. If the first transaction took place the loss of 1,000 yuan, then the sub-transactions will be reduced to 9,000 positions, and the potential loss of set between 1350-1800 yuan (15% - 20%), and so on.
On the other hand, if I first transaction profit 3,000 yuan, 1,000 yuan as a principal I will increase, and second positions in a transaction to 12,000 yuan, which will increase my starting (initial) Venture Capital (1 million) up to 20%. And so, even if I am at a loss under the deal, they still have a profit for the entire period (which is up to the next deal in terms of a loss of 20%). Quotes of the judge if I am right 50% of the right opportunity, then the trading strategy will be able to create a considerable harvest, assuming that I accept only 1:3 at most risk - reward ratio, even though I only every three transactions Once a profit, my income is still considerable. In other words, if you each transaction may be paid at least an objective measure of the potential losses may be three times the long run, you will be able to maintain consistent profitability. This is the job market speculation of the principal financial institution management.
According to my understanding, the right to choose-the-counter market, the world's largest trader - Reyna, the right to choose the company (Ragnar Optinos Corp) is consistent with such a trading strategy manage their huge trading company; well-known Bruce - Koffner managed by the world's largest inter-bank money market (Interbank Currency Market) and the futures market traded funds, they have a world of speculation has made remarkable achievements, but they can not, like Buffett, so Mainstream figures of the same lasts, because they are the speculators!
