After twenty years of stock trading, from the big losses at the beginning to the stable compound interest in the following years, I have summarized these 10 iron laws, which are all practical knowledge. I suggest you collect them!

1. The common problem of retail investors all over the world is that they will hold on to their stocks when they lose money, and will sell them immediately when they turn from losses to profits.

Never look at the trend, do not look at the trading volume, only look at the account profit and loss ratio, the final result is that the loss is infinite and the profit is limited.

At this time, you need to do the opposite operation and take measures to stop profit or stop loss.

For example, stop profit 10% and stop loss 5%. If you can ensure that you stop profit 10% and stop loss 5% each time, then operate 100 times. In this way, even if your winning rate is only 50%, your profit will reach 800%. Is it difficult?

It should be noted that if there are three consecutive losses, don't rush to operate. You should calm down and reflect on what went wrong and adjust your mentality.

2. Among all indicators, the trading volume indicator is very important. If you learn this, you will crush 80% of the traders. The volume ratio reflects the difference between the current trading strength and the trading strength of the past five days, which is manifested as amplification of trading volume + or shrinkage of trading volume. If the volume ratio is less than 0.5, it is a significant shrinkage. If the shrinkage can set a new high, it means that the main force is highly in control of the market, and the possibility of the main force selling can be ruled out. If it is in an upward channel, the probability of eating meat is very high.

If the stock is trading at the daily limit, the volume ratio is less than 1, which means that there is still a large room for growth, and the probability of another daily limit the next day is very high; if the volume ratio is greater than 1.5, and the stock that has a shrinkage correction after breaking through a certain important resistance level (such as the 20-day moving average*) is a rare buying target.

3. Pain points of retail investors: not shorting, eager to cover positions in a weak position, less capital and more stocks, fluke mentality, and dead stick to the end If you hold more than 5 stocks, and most of them are losses.

At this time, what you need to do most is to reduce the number of shares held, and sell first when the trend breaks (such as falling below the 20-day moving average). The number of my shares has never exceeded 3, even in a bull market.

The smaller the funds, the more concentrated they should be, and concentrate on analysis and the most reliable tickets. The more choices, the greater the probability of error.