Category: Money tips Release Date: 2006-07-24
England, 14th century logicians Wei Lianti out a principle: if not necessary, do not by entity. This way of thinking came to be known as "Occam's razor."
Occam's razor starting point is: Mother Nature will not do anything extra things. If you have two principles, which could explain the observed facts, then you should use a simple that, until more evidence was found; for the interpretation of the phenomenon, the simplest is often more correct than the complex; if you have two of similar solutions, choose the most simple, and need at least the most likely hypothesis is correct. Sentence: to become cumbersome knife cut, so do try to keep it simple.
Many successful and great scientists, such as Copernicus, Newton, Einstein and so on, are the first to use this to sharp, "Occam's razor," the most complex issue into a simple conclusion, and then embark on leading to the brilliant genius of the Road.
Investment in the stock market, we can also pick up the "Occam's razor," the complicated things simple. You'll find that in fact very simple stocks, the investment earnings is actually not difficult.
Some investors think the market is a paradise for those who are hard-working, only badly battered, bustling analysis, research and frequent operation, it may be successful, this is actually a big mistake. They often feel this way: For the stock market have devoted a great deal of time, money and energy, busy all day, but it is still difficult to cope with the market so much information and can not understand so many stocks, as well as emerging regulations and investment in new species. They always try to grasp everything, but the result was just exhausted, and even "include a" loss.
According to Occam's razor law, investors need to simplify their investment, it is necessary to those who consume a lot of our money, time and energy to distinguish between things, and then take steps to get rid of them:
Simplified stock picking. At present there are nearly 1400 in Shanghai and Shenzhen stock market listed company, if shares are to study each and concerns, neither the time nor the need. Therefore, the stock picking to make use of Occam's razor law, to a large number of listed companies shrink capacity, only a very few select stocks in which to pay attention to and operations.
The simplest technique to read the tape, in fact, away from the stock market, do not Tiantian Kan plate. Su Shi's "title Xilin Wall" in the poem saying: "Wang as Ling side of a peak, near and far the level of each are different; does not know the truth about the matter, only the edge of the body in this mountain," tells a number of investors every day, carefully read the tape to identify the trends or the direction of development is the real reason. The so-called "distance produces beauty", which are in the stock market did not achieve the desired income investors, and the stock market may wish to keep a distance, you will be more easily found in the real stock market as it is.
Less is more operations. Stock market speculation is not a good time longer, nor is the number of the better fried. Operation too frequent, will inevitably increase the transaction taxes, raise investment costs, but also a full-band cut the profit is divided into many sections, but also make an overall profit decline, affecting investment returns. If it is frequently operate in the downward trend, and often will speed up the loss of speed. At the same time, frequent short-term operation of the investors operating skills, his attitude is the quality, determining capacity requirements are high, if slightly anything wrong rhythm, it may come to naught. There are many successful investors in the market, with 90% of the time their short positions, finished a strong quit after the band Quotes, patiently waiting for the next Quote of the buying opportunities, small but efficient operation make them winners in the stock market.
The simplest technique is to closely follow the trend of the operation of the operation. Stocks as long as the tendency towards the line, and the hype for the individual stocks should be based on accurate judgments on the basis of the trend: When determining the trend of stock prices are going up, regardless of how much has been profitable, should be firmly held to strive for maximum profits; when determining stock prices downward trend, regardless of how much has been a loss, you should immediately liquidate out to prevent losses from expanding further.
