Transaction analysis: the fallacy of small and big

​​The so-called big gains with small losses are to gain huge profits with very small losses.

The outstanding players in the market, as well as platform operators, analysts, trainers, and even traders who are still losing money until now, are they all trying their best to warn you that traders want to make profits and succeed, to achieve At the pinnacle of life, should a small loss be used to make a huge profit?

​My friend, does this Guigao concept, regarded as the holy grail of trading, run through your entire trading process? So have you really thought about whether this concept is really correct?

From an intuitive point of view, it does make sense.

But, I said but. Friends, do you understand that it is this theoretical concept that makes you intuitively think that it is extremely correct, but ultimately causes you to continue to lose money.

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Obviously, it is a small probability event with a very low success rate to make a big fortune with a small one, because it violates the principle of proportionality between risk and benefit.

For example,

You play a game with Zhang San, you win 100 if you win, and lose 50 if you lose. You are naturally very happy, but will Zhang San play this game with you?

Maybe, the reason is that Zhang San has a problem with his brain. ​

Then change the question,

You play a game with Zhang San, you win 50 and lose 100. So will you play games with Zhang San?

You hesitated and said: Yes.

Of course, that doesn't mean you have a problem either. It means that you can be sure that you will win this game, and you will not play the game with Zhang San again.

But we do not make a deal with one hammer, but go through countless games. In this case, after careful consideration, do you still think that the above small losses and big profits can exist and last for a long time?

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In the financial market, even if you have hundreds of thousands or millions of dollars, you are nothing but ants in front of the hundreds of millions or billions of dollars in institutions. What's more, it may only be a few thousand dollars in your hand?

Institutions often rely on their own strong financial strength, which can crush Xiaosan without hesitation and grab high profits. It relies on bullying the few with the big, and bullying the small with the big, because this is an inevitable means of hitting a hit. The hand raised the knife and fell, simply and directly.

When a lion fights a rabbit, it also uses all its strength. This is the way for the strong to survive.

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how? Do you think that institutions will give up their dominant strategy of bullying the few with the more, and instead choose to bully the less with the less, which is not conducive to themselves?

Friends, we all know that financial transactions are extremely risky, and the capital in our hands is also limited, which can be described as extremely small.

Under the constraints of limited capital, it is necessary to make a huge profit with a very small loss.

It's hard for me to imagine that you can really do it?

At least I can't do it myself.

Can the gods do it?

Of course you can, but gods don't exist!

Because everyone is mortal.

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And you are just as ordinary as everyone else, not to mention that you are not a protagonist who can turn clouds and rain and turn dangers into safety everywhere. This kind of small loss to gain big profit, such a small probability event of getting rich overnight, how could it fall on your head so smoothly?

After all, those who can lick blood on the knife edge of the capital market are opportunistic and shrewd people in society, and it is commonplace to seek advantages and avoid disadvantages.

If every time you trade, the stop loss is always greater than the take profit, then this only shows that your risk control is rotten. And if every time you trade, the stop loss is always smaller than the take profit, which means that you are acting against the sky, taking a chestnut from the fire, and sooner or later your position will be liquidated.

Using small to make big is not designed for the strong, and using small to make big is not a survival strategy for the weak.

Since the method of the organization is to use the big to bully the small to win the few with the many, then when you want to use the small to make big gains, don’t you just fall into the trap of the organization?

It is conceivable that what the institutions like most is that you can make a big difference with a small one.

Friends, in this way, isn't it a fallacy to fool you into trading and continue to lose money with a small gain?