Trading ideas of a futures master

A while ago, a futures expert told me intermittently about his trading ideas, and his style of painting was a bit condescending.

First, you must understand the basic principles of futures trading profitability. I summarize this principle into a formula, namely: trading profit and loss = opportunity success rate X opportunity position rate X position profit and loss rate. As long as you ensure that the probability of success in your transaction is greater than 50%, the position when the transaction is successful is greater than the position when the transaction fails, and the loss when the transaction fails is less than the profit when the transaction is successful, then you will undoubtedly win.

Second. So how do you achieve an opportunity with a success rate greater than 50%?

1. First, figure out what you are trading on. My experience is that the only basis for small funds can only be technology, and it is concise technical graphics. On this issue, there are three biggest traps: one is the so-called fundamental news, the other is the so-called celebrity forecast, and the third is the so-called Comment. The reason is simple, even if the three trading bases are correct, if your technical trading points are not right, a shock will make small funds unbearable. For example, the current candy market, Rogers said it was going to fall, and that nonsensical yelling person also said that it was going to fall. Can we build positions based on these? I was also prepared to go short, but I would never intervene casually. I have to wait for two technical conditions before going short: a breakthrough in the range + the moving average system converges and gives a direction. If the given direction is upward, I will change my mind and go long instead of short. My only basis is technical graphics. As for Rogers, I don’t take him seriously. The reason is simple. If I lose money, he won’t compensate me. Why should I listen to him?

2. Secondly, what technical graphic trading do you use? My experience is: the more primitive and simple, the better. It is enough to use the range + trend line / moving average / neckline (pattern). Therefore, it is recommended that you delete all other graphics. Using these technical tools, can you see what sugar looks like? Domestic sugar fluctuates in the large range of 6000--6600. The recent moving average system is messy and has no direction: No. 11 sugar in the United States also fluctuates in a range, but down The risk of breaking the position is relatively large, and the trend of breaking the position on the daily line is more obvious. Use graphics, be concise at first glance, and still need to listen to Rogers? When I say this, I am sure someone will accuse me of disrespecting big names.

I have my reasons: First, even if what Mr. Luo said is right, sugar can really fall by half in the future, but it hasn’t fallen at present, and the current rebound is enough to make me die short. If it falls after I die, it will be beneficial to me. What's the point? Second, are there few wrong things done by famous people in history? Third, I earned my own money, so why should I use it to cheer him up? So, don't trust Rogers and his followers, believe in Own eyes + technical graphics. If the technical graph has risen, just follow up, even if Lao Luo said it will not rise, it will still rise; if the technical graph has fallen, just follow up, even if Lao Luo said it will rise, it is useless.

3. How to use technical graphics? The first step is to see clearly the large range of price operation and know where the price support and resistance are. Have you ever seen a big river? The two river banks determine the running range of water. The price is water, and the range is the river bank. The second step is to use the trend line and the moving average to determine whether the price is in a shock or an obvious unilateral direction; the third step is if the price is in a shock, do not trade, or do short-term according to the side line of the shock Trading; the fourth step, if the price is in a unilateral trend, follow the general direction, and open a position after a pullback. The current sugar is fluctuating in the range. The correct way to trade is to either not trade and wait for the breakthrough direction; or go long or short near the two sidelines, and then set the direction of the midline after the range breaks through.

In short, as long as you can distinguish whether the price is in a shock or a trend, and when the price is in a shock, sideline trading: stick to the trend + reverse wave trading in the trend, then your probability of success is greater than 50%. Of course, if you say you can't tell the difference between shocks and trends, then I can only put you in that category of people who haven't started. The difference is that I also suggest that you put your time into learning, so that you can get started quickly instead of being outside the door all your life.

Third, how do you control your position?

First of all, you must understand that position control is absolutely necessary. Because no opportunity is 100% right, and our human cognitive ability will always make mistakes. If you trade with a full position or a heavy position, once you make a mistake, you must die. There is no more chance. I suggest: at any time, the total position should not exceed 50%, the position of a single product should not exceed 30%, and the product such as sugar should not exceed 20%. It is also very important to set the position to be built as Divide it into two halves, if the first half is right, add the second half. However, do not increase your position when trading on the sidelines of the range.

Fourth, how to control the profit and loss ratio of positions?

1. You must be able to stop losses. First of all, you must accommodate the stop loss when opening a position. If it is not easy to stop the loss, or the stop loss is large, it is better not to open a position. For example, in the current sugar, you are short at around 6500, not far from the sideline, so it is good to stop loss, otherwise, you will really be in a dilemma.

Secondly, don’t stop loss casually. This requires you to take a light position. As long as the general situation has not changed, don’t run away easily. Again, once the general situation changes (breakthrough), you must run away 100% at once. Now sugar, if If you break the interval, the faster you run, the better.

2. Learn to make big money. The method is very simple; once you do it right, draw a band trend line, if you don’t break the trend line, you will never come out.

Fifth, summarize my trading ideas:

1. From the perspective of trading methods, it can be summarized in ten words: follow the trend, go against the wave, control positions, stop losses, and expand profits.

2. As a trader, it can be summed up in eight words: objective (trading with eyes only), patience, conciseness, and consistency.

Everything is not something that anyone is born with. The road to investment is relatively hard, and very few people persist. For those who have just entered the futures market, they must learn more and improve themselves.