High winning rate useless? A trading rule that turns 400 US dollars into 200 million US dollars with a 95% loss rate but only a 5% winning rate.
The currency world is still in a barbaric period, which is comparable to the early U.S. stocks. Before all regulations were officially implemented, although it was still a high-risk asset, it was indeed a paradise on the cusp of the storm. Because of this, the early U.S. stock trading rules were also It will be of great reference value.
Today I would like to introduce to you Richard Dennis, a legend in the US stock market. This legend has a winning rate of only 5%, but because of his unique trading method, he has grown from just 400 US dollars to 200 million, and he has ten apprentices. A few people, and later the total assets under management reached billions of dollars, that’s right! It was US$100 million 50 years ago!
And why is his defeat rate so high? He must believe in a rule "Let Profit Run, Cut losses Short." Translated into Chinese, it means let profits continue to fly and losses be reduced to the lowest point. Most people tend not to review the transaction when making transactions. For example, why did they make money? Why did you lose money? In fact, when making money, you need to be calmer. Excuse me, why do you recommend everyone to play Poker at this time? This can also train your patience to make yourself more calm and determined, so that you can make the right decision like Iaizan. Back to the topic, this set of trading rules is called the "Turtle Rules" and it mainly consists of four levels:
follow the trend
Just like cryptocurrency, don't think that a certain point is a high point, or that a certain point is a low point. When buying the bottom, you should only start building a position when the trend reverses, because you never know where you are, and you might take the knife. To place orders with the trend, for example, at the beginning of a bull market, you can try to follow the trend as most of the orders are long. The stronger the trend, the easier it is to make money and the easier it is to roll up positions, so there should be no so-called rise. If you are high, you need to see if the general environmental trend is on your side!
technical analysis
Technical analysis is an auxiliary tool, and the final decision-making power still lies in your own hands. If the results of technical analysis are inconsistent with your own judgment, you would rather not place an order.
anti-market mentality
I will explain it as the banker's thinking here. After all, the amount of funds in the currency circle is still very thin. How to avoid being cut off by leek must also think about what the banker will do behind the scenes. For example, the funding rate in the futures market can show the trend of most funds for the asset. Although some people use rates as a market psychological indicator, if most people are bullish, it most likely means that it is not far from the peak. . And if most people are bearish, it’s probably almost the bottom. Therefore, buy when the shopping street is full of blood, and sell when the crowd is noisy. In the currency circle, there are many tools that can verify each other, and the data on the chain is also open and transparent, so you can make good use of it!
risk control
It should be said that it is the top priority of all. If you open an order to enter the market, you should have a floating profit under the trend of the market. However, if you continue to lose money for a period of time after entering, it is basically the wrong direction. Whenever you place an order, you should be prepared for the worst, and have the discipline to cut your position and not leave an order when you cross the line where you want to close your position.
These are all in the book "Turtle Trading Rules". It is recommended that you read it carefully. What is also interesting is that Richard Dennis's disciples are also called Turtle Traders. These turtle traders every year The average profit is more than double the asset. Successful traders can be trained, and what needs to be respected most is discipline and principles! He is also one of the traders I personally admire the most!
