Always losing money in trading? You may have fallen into these 8 psychological pitfalls!
1. Anchoring bias: Just like when you go shopping and see a piece of clothing with a price tag of 1,000 yuan, you think it is expensive. But if there is a more expensive one next to it, 1,500 yuan, then the 1,000 yuan one will seem cheap. The same is true for trading. If you have an "anchor" in your mind, the price will follow it.
2. Recent bias: Just like you just had a big meal and still remember the deliciousness, you want to eat better for the next meal. The same is true when trading. If you make a little money recently, you think you are a stock god, and you want to make a big profit in the next transaction, but you may end up losing money.
3. Fear of losing money: The joy of making 100 yuan may not be as great as the pain of losing 100 yuan. This mentality makes traders want to run away as soon as they make a little money, for fear that the money they have earned will fly away again.
4. The baby effect of their own family: Just like you think your baby is the smartest, it is also the same when trading. The assets in your hands always feel better than those of others. You are reluctant to sell them even if you lose money, and you just hope that it can turn around.
5. Following the trend: If others are buying, I have to buy too; if others are selling, I have to sell too. Following the trend is not a good thing. You have to have your own opinions and don't be led by the crowd.
6. Memory misleading: Just like you remember being chased by a dog last time, you will be afraid of dogs in the future. The same is true for trading. When the market fluctuates recently, you are scared and dare not move.
7. Success fantasy: Always seeing stories of others making money, you think you can do it too. In fact, there are more stories of failure, but you just don't see them.
8. Information packaging effect: Just like the advertisement says well, you want to buy. The same is true when trading. How the information is presented determines how you judge. When you are in a good mood, you think the risk is small; when you are in a bad mood, you think the risk is high.
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