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Foreign exchange trading taboos

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It is not an exaggeration to say that the field is the most "three public" spirit. Every day, the global turnover of more than 3 trillion US dollars also highlights its undisputed status in the financial field. However, compared with other games, the participation of retail customers in the foreign exchange market is significantly lower, which also determines that the information support and education work for the foreign exchange participants are obviously lagging behind, and many newcomers have gone through many detours. Based on the experience of foreign exchange trading in the past seven years, the author has summarized the following several foreign exchange transactions taboos to share with readers: 1. Long-term investment. The first thing to do is to make clear that the foreign exchange field and the other fields are essentially different. The foreign exchange field is a relative field, and its essence is a place for zero-sum games. This attribute determines that it is definitely not worthy of long-term investment. Data is the best proof. Whether you look at the past 5 years or 10 years or even longer, no matter what kind of currency conversion you have at the starting point, there are only two possible outcomes after a long month: the first is you. The currency that was exchanged was devalued, and it was really worth the loss. The relatively good second result is that even if the currency you buy appreciates, what is the rate of return after time conversion? In the mainstream currency, we have chosen the best performance in the past 5 years and 10 years. For example, the cumulative absolute increase against the US is only 10% and 23%, and the compound annual yield will be around 2%. It is known that this is the best of all options. Therefore, before entering the foreign exchange field, it must be clearly recognized that this field is not a Buffett-style after-sales career. This field requires diligent band trading to achieve profitability goals, although it does not completely exclude relatively long-term (no more than One year) strategic choice. In other words, the foreign exchange field is a real “transaction” field. 2. Diversified investment. Also based on the previous one, Markowitz's portfolio theory is basically not applicable in foreign exchange. If the truth of “Don't put eggs in one basket” has a theoretical background in other fields, especially the capital field, then this truth will become a paradox in the foreign exchange. Because different market targets of different capital markets will form weak correlations due to factors such as industry differences and individual differences, the characteristics of the foreign exchange field are that they have an obvious anchor (such as the beauty since World War II), almost all currencies and this anchor. There will be a consistent direction of volatility, which also makes the order on the forex field more based on the judgment of the anchor direction. Once there is a pre-judgment on the anchor trend, the second-step variety selection becomes a relatively minor job. Of course, in this second step of the work, the author has always adhered to the only preferred principle. If this time adopts an excessively diversified investment strategy, it will involve unnecessary energy and thus affect the decision-making judgment of the first step. Extremely speaking, if your foreign currency assets pool is half beautiful and the other half is configured according to the proportion of the US index, it is unfortunate that your portfolio has ensured that you are in an invincible position. 3. Superstitious experts. Many new friends will form a preference for individual experts when they look at the reviews through different channels. Of course, there are a lot of Forex analysts who have good field judgments, but that doesn't mean how much substantial help you can bring to your actual trading. Not to mention that most of the exchange reviews lack the timeliness that foreign exchange exchanges value, and more importantly, most trading strategies will not be static forever. If you only listen to an expert's admission recommendation, but ignore the corresponding dynamic profit, stop loss and strategic changes in an emergency, then most of your documentary actions will be a disadvantage. Therefore, instead of "fishing" with experts, it is better to learn the "fishing" of experts, so that in the long-term trading process, you can make yourself, not losers.


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