Do you know "loss aversion"? This article is a reflection and summary inspired by the famous "loss aversion" theory, let's take a look.
In 1985, the famous psychology professor Yakos and Brammer conducted an experiment.
They first asked subjects to pay $100 for tickets for a ski trip to Michigan, and then told them a few days later that a ski trip to Wisconsin was much more fun and cost only $50.
So the subjects went back and bought tickets to Wisconsin.
A few days later, the professor told them: "The timings of these two ski trips collide, and you can only choose one.
" funny one.
The explanation they give is that if you choose the $100 option, you only lose $50, but if you choose the $50 option, you will lose $100.
This is the famous theory of "loss aversion": When people face gains and losses, losses are more unbearable to them.
Professor Yakos finally concluded: "90% of the misfortunes in life are due to unwillingness. This is the reason why many people don't know how to stop losses in time." Humans
are emotional animals, and they are always easily controlled by inner fear. , Rather than tearing down and starting over, looking for a better opportunity to regain a new life, they are more willing to stick to what they have to avoid immediate losses.
Compared with the persistence driven by the weakness of human nature, it takes more courage to give up the previous efforts and start from scratch.
People don't always make the right choice. When we find that the choice is wrong, we must accept the status quo and stop the loss in time.
At that time, Levi Strauss, who was only 21 years old, was a member of the gold rush army. But there are too many people who come to pan for gold. At a glance, there are densely packed tents.
At this time, Levi Strauss made a decision not to follow the trend blindly, but to open a small store specializing in the daily necessities of the gold diggers, and he unexpectedly made the first pot of gold very quickly.
Once, he purchased a lot of daily necessities and a large amount of canvas for tents and carriage covers. The daily necessities were quickly sold out, but the canvas was ignored.
A gold digger came over and looked at the canvas. He thought the worker wanted to buy canvas, but the other said, "I don't want canvas, but I want a pair of pants that are as durable as canvas.
" Lili's canvas made various styles of trousers and clothes, and recommended them to the workers. Unexpectedly, the clothes and trousers sold like never before.
Later, Levi Strauss founded the famous denim brand Levi's.
True persistence is not doing one thing blindly, but giving up, adjusting and choosing in time. Only in this way can people go farther and wider on the right path.
In trading, some people may never really realize the importance of stop loss, and maybe they will stop loss only when the loss is too large to make him collapse.
Many investors have faced a loss of nearly half, and only then began to ask what to do, regretting that they did not stop the loss in time. But unfortunately, there is no medicine for regret in this world.
Trade according to a plan and stick to it. ----Know your goals and how you intend to achieve them. Before making any futures investment transactions, you must know every possible outcome. In the process of trading, confusion is your worst enemy; it will cause you anger and emotional agitation. When drawing up a trading plan, you must first decide on your time structure, the one in the short, medium, and long-term. Learn what trends to focus on and how to set stops based on the relevant trends.
When you are in doubt, get out! The best way to avoid doubt is to have all the relevant information you can. If you have a well-founded suspicion and do not have confidence in the transaction, you should leave the market!
Profitable positions cannot be allowed to turn into losses. Or, take as many positions as you can that are sure to make a profit. Use the trailing stop method to operate. Adjust stops based on different risk/reward ratios.
Recognize losses quickly and let the profitable position continue to develop. This is the most important, most quoted, and most often violated rule.
Don't put all your eggs in one basket. If you have already lost a lot in the market, don't bet all your eggs in one basket and make fun of your life! Don't think that you can save your capital or turn defeat into victory. In fact, such reckless behavior can only be counterproductive!
Add
