Winners and Losers - Cryptocurrency Exchange Platform

"The best way to make a small fortune in financial speculation is to start with a large fortune.

"Most active speculators,

whether they trade stocks,

foreign exchange,

futures,

options, or financial derivatives,

their fate is always to end up suffering losses.

On January 10, 1983, The Wall Street Journal published a survey of 20 senior commodity traders and their best investment choices in the first half of 1983.

The first choice scored 3 points,

the second choice scored 2 points,

the third choice scored 1 point.

Results:

Buy copper 18 points,

Buy gold 16 points,

Buy foreign currency 15 points,

Buy stock indices 14.5 points,

Buy cattle 11 points,

Buy silver 7.5 points.

Obviously,

all the recommendations were about buying real estate.

In fact,

later only stock indices and copper increased in price over the six months,

gold and foreign currency prices declined,

cattle and silver prices fluctuated slightly.

And the commodities that showed a bull market at that time,

namely grains,

soybeans,

cocoa,

cotton, and sugar,

were completely ignored by the “experts.”

This shows that even for experienced experts,

predicting the movement of futures prices,

even just six months in advance,

is quite difficult.

These disappointing records of experts serve as a reminder to serious and diligent speculators:

1. Experts also make mistakes frequently.

2. The most worthwhile recommendation is: good technical skills in investment and timing,

coupled with meticulous money management and a focus on following the market rather than predicting it.

In the stock market,

there is a similar situation between experts’ expectations and the random selection of stocks.

The Wall Street Journal conducted a six-month competition between two groups of “analysts,”

people might think that “professional experts” would consistently beat “dart throwers,”

and with a large margin.

But in fact,

over several consecutive years of competition,

“experts” outperformed “dart throwers,”

but at most, only by a small margin.

Regardless of others’ opinions,

regardless of their existing professional skills,

sharing trading strategies and market views with others is very pointless.

The truth on Wall Street is "the knowledgeable do not speak,

those who speak do not know."

Many traders often find themselves buying near the highest point of the trend,

and selling near the lowest point.

This situation is fundamentally due to not catching the right timing and tactical errors,

not because other traders are “plotting” to beat you.

We can always easily find reasons for our misjudgments and poor trades.

A feasible correction method for this “loser mentality” is: analyze the market you are in,

plan your strategies and tactical actions in advance,

and keep them secret.

Do not listen to anyone else’s advice,

including brokerage consultants,

rumors, and some well-meaning market gossip.

At the same time, do not give advice to anyone else.

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