I am a participant of #BabyMarvin_f9c7🔥 . Let's discuss why many people say the end of trading is liquidation?

Many people believe that the ultimate result of trading is often liquidation. Theoretically, if you continue trading, your funds will gradually decrease until they reach zero.

Assuming your trading probability is 50%, with a principal of 10,000 yuan, and each profit and loss is 1,000 yuan, with a commission of 100 yuan. In this case, the result of first making a profit and then incurring a loss is: 1,000 (profit) - 100 (commission) - 1,000 (loss) - 100 (commission) = -200 yuan. This means that although the chance and amount of profit and loss are equal, in the end, you still lose due to the commission.

If we don't consider the amount of profit and loss, but look at the profit and loss ratio, for example, 10%, under the condition that the principal and commission remain unchanged, the result would be: 10,000 × 10% - (10,000 + 10,000 × 10%) × 10% - 100 - 100 = -300 yuan. If we add the spread, the loss would be even more severe. Theoretically, no matter how you trade, you will ultimately face losses until the principal is exhausted.

In reality, most people have a higher probability of losing than winning, because those who profit usually possess some kind of trading advantage.

Therefore, many people say that the end of trading is liquidation. This requires us to improve our winning rate to continue participating in the market. If you feel confused about trading right now and want to find direction, feel free to follow me and leave a message “1” to help you embark on the path to wealth!

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