Only by overcoming more than 90% of irrational psychological fluctuations can you become the winning 10%——
Most investors experience the following:
When they make money, they are often eager to stop profit and are afraid of losing the existing profits.
When they lose money, they usually feel unwilling, so they are more willing to take greater risks to try to recover losses.
Our emotional reaction to losses is stronger than the joy of gains, which is why the pain of losing money is far greater than the pleasure of making money.
These common investment psychology are often the root cause of investment failures-we cannot correctly face the gains and losses in investment.
In trading, most people often make the mistake of not wanting to admit mistakes when they lose money and leaving the market too quickly when they make money. This behavior is completely opposite to the core concept of trading-holding correct and correcting in time. We need to correctly understand the risks and rewards of investment. Only by overcoming personal weaknesses can we win in the market.
Making a good plan, persevering, and firmly executing can help you overcome more than 90% of irrational psychological fluctuations.
So, please ask yourself three questions:
Are you currently in a state of profit or loss? How do you feel inside? Can you formulate a better strategy to deal with it?