If you decide to venture into contract trading, be sure to keep the following core points in mind! It's crucial!
1. Contract trading is about leveraging small investments for large returns, with losses being the norm: People react differently when faced with stop losses. Some impulsively open orders in succession, while the wise choose to enter a cooling-off period. If you frequently encounter stop losses, the best strategy is to pause trading, take a deep breath, and replan your strategy.
2. Steady investment, reject impatience: Trading is not a shortcut to quick wealth. In the face of losses, remain calm and do not rush for results or blindly over-invest. Patience and strategy are equally important.
3. Follow the major trends and go with the flow: Identifying and aligning with market trends is crucial. In a one-sided market, trading against the trend is like rowing upstream, which can easily lead to losses. Whether you're a novice or experienced trader, you should learn to adapt to the market and patiently wait for the best entry opportunity.
4. Optimize the profit-loss ratio for steady gains: Ensure that the profit potential of each trade far exceeds the potential loss, achieving at least a 2:1 ratio, before considering a trade. This is the key to sustained profitability.
5. Avoid frequent trading, maintain restraint: Frequent trading is a major taboo in contract trading, especially for beginners. Control the impulse to open orders, cherish every trading opportunity, and let every decision be based on careful consideration.
6. Know your limits, invest rationally: Only invest in areas you understand and can control. Opportunities that exceed your understanding often come with unpredictable risks.
7. Strictly enforce stop losses, refuse to hold positions: Set reasonable stop loss points and strictly implement them. Holding positions is a major taboo in contract trading; it not only exacerbates losses but may also put you in an irretrievable situation.
8. Stay humble during profits, avoid arrogance and impatience: Do not become complacent when making profits; maintain a calm and humble attitude, as excessive confidence often accompanies the next failure.
Remember, contract trading is a marathon, not a sprint. A steady strategy, a good mindset, and continuous learning are the keys to success.
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