In the past, I have been puzzled as to why retail investors frequently lose money even in bull markets. In addition to those examples of contract abuse and large positions, what is even more surprising is that some people do not even use leverage and still lose money. Later, I gradually discovered that the assets they held were often "junk".
So, what is "garbage"? I have summarized some standards:
When the pie skyrocketed, these assets did not follow suit and barely rose by a few points.
After the rising trend of the market weakened, it entered a high sideways fluctuation stage. This was the best time to exit the market for those who held these assets, but they chose not to move.
When the market begins to pull back, these assets plummet and are unable to recover.
If an asset meets the above three criteria, it should be removed from the watchlist without hesitation.
Many people will stick to the assets in their hands because of the anchoring effect and sunk costs. They will think: "The big market has risen so much. I have held it for so long and it has not risen much, so it will definitely rise. I have to hold on to it." The result is often a tragic ending.
In every bull market, in addition to the injection of liquidity at the bottom, there will always be one or two hot spots that can break out of the bull market. Funding needs to be supported by a story, even a lame garbage story.
In 21, we witnessed the rise of DeFi, NFT and GameFi. In the 2022 bear market, we saw the popularity of running shoes GMT.
In this circle, the new person must be better than the old person, and the old person will never cry.
