If you want to make money in trading, what principles do you need to understand?

Let me tell you my opinion:

1. The position should be reasonable. The size of the position directly determines your performance.

The lower limit of the position should be large enough to at least be worth your time cost and energy invested. If the position is too small, it is a waste of life.

The upper limit of the position should be small enough, and the continuous loss should be considered first. Any strategy requires the law of large numbers to play a role, and the number of transactions must be large enough, and the potential number of consecutive losses limits the upper limit of the position. If your position is so heavy that you can only lose 3 times in a row, you may fall before the law of large numbers comes into play.

Secondly, the position should not exert too much pressure on the psychology. If the position is so heavy that you can’t even bear the normal reverse fluctuations, then you might fall into the trap of “entering the market with a heavy position → taking the initiative to stop the loss → distressed → delusional to return the capital once → entering the market with a heavy position → taking the initiative to stop the loss” .

2. The stop loss is used just in case, not just waiting to be knocked out by the market, the market eats your stop loss money.

A strict stop loss position can be placed after the transaction-intensive area, but if the microscopic pattern has gone bad, you must leave the market immediately, and it is easy to get it back if you look back.

3. The entry position is very important.

When the trend is clear, the entry position will be very poor. If you enter at this time, a pullback will catch you. Only enter tentatively when the trend is ambiguous, and if you see it right, you will have a floating profit as a buffer, and the psychological pressure will be much less.

4. Make yourself avoid heavy positions and floating losses forever.

Heavy positions and floating losses are like being bitten by an arm by a crocodile. Do you stand still or survive with a broken arm? Stiff hard, you may lose your head; survive with a broken arm, the arm just disappears; either result is unacceptable. No one on this planet can guide you to make the best decision right now, not even Soros Buffett. What we can do is to take light positions and cut them when we lose money, so as to avoid heavy positions and floating losses forever.

5. Try not to do data release instant market, especially non-agricultural.

The volatility, point difference, and delay at the moment of data release killed countless people. But before and after the data are rare time to make money.

When the data is released, make a cup of tea in peace and don't even look at the market. After 30 minutes, the regularity comes up and the momentum is still there. This is the best time to pick up money.