The life of a professional financial trader is filled with challenges, constant stress and pain. However, it is in this environment that they are able to achieve the most generous financial returns, especially those traders who specialize in derivative financial products. More importantly, a trader's psychological state and judgment will fluctuate dramatically in the process of making money (bringing happiness) and losing money (bringing pain).
Interestingly, being either too optimistic or too pessimistic can have a very negative impact on judgment. Only rational speculators can effectively control risks and achieve the goal of making more and losing less. Otherwise, they will fall into excessive speculation and end up with heavy losses and leaving the market sadly.
Therefore, the first task of a professional operator is to gain a deep understanding of oneself, master one's emotions, and develop a strong willpower. In financial transactions, some classic theoretical knowledge is also crucial. “The market is where money flows from the dull to the smart”, the importance of information, and the necessity of obtaining it in a timely manner and interpreting it correctly in trading.
In addition, concepts such as the Capital Asset Pricing Model (CAPM) and the Efficient Market Hypothesis (EMH) in modern investment theory also have a profound impact on trading decisions. CAPM helps understand the relationship between asset prices and risk, while EMH emphasizes that the market has fully reflected all available information, so it is impossible to obtain excess profits through analysis.
Overall, rational thinking, emotion management, and a solid understanding of financial theory are keys to becoming a successful professional trader.