In this market, only a few people make money. Generally speaking, the number of people who make money and those who lose money follows the 28 principle. Only a few people make money, while most people lose money.

So what exactly is the point that distinguishes these people?

Is it because of the education level? Do those highly educated people, such as graduates from our top universities, Tsinghua University and Peking University, do trading well? Or is it because a person is smart or not? A person with a high IQ is good at trading. Or is it because a person has learned a lot of technical knowledge and knows a lot of terms, the operating modes of various markets, and the operating modes, so he can make money in the trading market, or is it because he is invincible in stock trading? Or is it because of the quality of his family, his family is rich, and the subsequent funds are sufficient, so he is provided with a lot of opportunities so that he can always make money in this market?

In fact, it is not true, right? Careful observation reveals that no matter they are rich or poor, from good or bad families, or even teachers of finance at a certain university, many of them still lose money in this market. So how do we distinguish between those who make money and those who lose money? Let's think about a question, what are the participants in this market? It's people! Talents are the largest subject in this trading market.

Why do people lose money so easily?

First of all, this market is a zero-sum game market. Secondly, as long as one is a human being, there will be human shortcomings! A normal person cannot be completely rational. If he is completely rational, he may not be a human being. He will not have seven emotions and six desires, and will not contact this market. Therefore, if you want to trade well, the real distinction should be relative rationality and absolute anti-humanity!

Why do human weaknesses lead to money losses? In fact, this is inseparable from human evolution.

For example, losing money in this market is not a pleasant experience. We all don’t like losing money. Every loss is like a denial of ourselves. Think about it, do you like being denied?

Definitely not! So I will try to find a way to solve this problem. Do you think it is your own problem?

That was impossible, so I tried all kinds of methods, but eventually found that none of them could help me avoid losses, and I was left speechless!

Or they may hold on to their losses, thinking that they are stuck with it, and they don’t believe that it will fall to zero, because as long as they don’t close their positions, they are not wrong, and the final result has not yet been given. This has also led to a large number of retail investors being stuck in this market.

Intellectually, we want to earn more and lose less, but due to the intervention of human nature, we end up earning less and losing more.

Therefore, the key to whether you can make a profit lies in going against human nature. For example, Buffett often said, when others are greedy, I am fearful, and when others are fearful, I am greedy. That is, when you want to make decisions according to your own personality in trading, it is often a wrong decision. When you feel very uncomfortable and painful, the decision is often the right one.

This is the real reason why trading is difficult!