Consistent Profitability Requires Systems Thinking and Probabilistic Thinking

I found a very serious problem. The vast majority of investors do not have a trading system, and even their understanding of the trading system is wrong. Recently, many trading friends have communicated with me. Most of them are still asking whether the teacher can help me check this check and that check. Otherwise, they just ask the group if there are any daily ticket recommendations? Is there any market analysis? When you buy a mobile phone that costs several thousand yuan, do you also carefully compare its configuration, brand, and price? But when it comes to buying stocks, tens of thousands or hundreds of thousands, you just buy it based on your feeling, or you just buy it based on the so-called teacher's call. Why do I keep emphasizing the need to have your own trading system? Because only with a system can your operations be based, with a system can your execution be consistent, and with a system can the statistics of your orders be meaningful. Based on these data, you can analyze and optimize transactions. It is a probability game. If you have a probability advantage, you will win in the long run. Without probability, you will lose in the long run. This is the law of large numbers.

How should retail investors correctly understand the trading system?Before I say what is right, let me say what is wrong first, that is, retail investors should no longer speculate on the rise and fall of the market, and there is no need to analyze the effect of sector rotation. The rise and fall of the market has nothing to do with your personal stock trading. Only large funds need to pay attention, because you can clear positions with one click, but the main force cannot, and there is no need to split sectors. Institutions invest in lithium batteries because they value the development of new energy in the future, while retail investors trade in lithium batteries today, banks tomorrow, and military industry the day after tomorrow. They just rely on guessing or watching the news. I really want to suggest that everyone watch Livemore's "Memoirs of a Great Stock Operator》. So what is the correct understanding of the trading system? Your trading system is a set of universal rules. What should you do when you encounter a trending market, and what should you do when you encounter a volatile market? Take it if it meets expectations, and leave if it meets stop loss conditions. There is no prediction of the market, no prediction of sectors, and no prediction of the future trend of individual stocks. It is just to perform the corresponding operations of the system based on the current situation. As long as your system has positive expectations, time will accumulate profits for you. The most important thing you should do now is how to ensure the positive expectations of the system.