Forex multi-account manager Z-X-N
Accepts global forex account operation, investment, and trading
Assists family office investment and autonomous management
In the field of foreign exchange investment and trading, traders who are relatively isolated tend to have a higher chance of success than other traders.
The deep-seated reasons behind this are worth further analysis. Loneliness and loneliness can maximize the self-reflection of traders and significantly reduce the interference factors of the external environment. However, in the current Internet era, information dissemination has exploded and people are surrounded by massive amounts of information at all times. If you want to effectively reduce external interference, setting up not to receive any information notifications may be one of the effective ways to achieve this goal. The following are some typical examples of industry predecessors who have gone through difficulties and finally successfully eliminated interference in the process of dealing with information interference.
John Templeton: In the late 1960s, Templeton accumulated considerable wealth by selling consulting and other investment businesses. Against this background, he made a strategic decision to shift the focus of his life from the United States to the Bahamas and built a residence on a private territory called Lyford Cay on the island. In addition, he set up a small office in the local police office building near his home. He lived there from 1968 until his death 40 years later.
Stanley Kroll: Stanley Kroll felt a strong sense of uneasiness when he held a large position. In order to avoid panic and hastily closing positions when prices fell back, he decided to take a strategy of traveling abroad to relieve the pressure brought by the market. So, during August and September, he and his wife flew to Switzerland, rented a farmhouse in the suburbs, and lived a relatively isolated life, neither answering the phone nor reading commodity information in the newspaper. During his time in Switzerland, wheat prices fluctuated greatly, rising to 558 cents, and his floating profits increased by hundreds of thousands of dollars. At noon on the day of closing the position, Stanley Kroll gave his wife a surprise - an extremely luxurious Rolls-Royce car. Then they closed their office in New York, packed their bags, and retired from the market for five years.
In the field of foreign exchange investment and trading, the use of long-term investment strategies based on indicators such as the US dollar index and the euro/dollar is an effective method that has been proven in practice.
Similarly, long-term investment and trading based on international stock indices is also a common investment strategy. Specifically, when trading US stocks, the Dow Jones Industrial Average should be used as an important reference; when trading Japanese stocks, the Nikkei 225 Index should be used as a reference; when trading Chinese A shares, the Shanghai Composite Index should be used as a reference; when trading German stocks, the German Frankfurt DAX Index should be used as a reference standard; when trading French stocks, the French Paris CAC40 Index should be used as a reference; when trading British stocks, the London Financial Times 100 Index should be used as a reference.
The specific investment strategy is as follows: when the relevant index rises by 25%, investors can consider selling some stocks; when the index falls by 10%, more stocks with potential can be bought. If investors plan to adopt a phased selling strategy for stock investment, they need to conduct in-depth research and analysis on the companies they invest in, and seize the opportunity to build positions at low levels. Lower position building costs can provide investors with a greater margin of safety.
By drawing on the long-term strategy of stock index investment and trading, in foreign exchange investment and trading, long-term investment strategies based on indicators such as the US dollar index and the euro/dollar can also be adopted. The euro/dollar exchange rate almost reflects the core trend of the largest currency pair in the foreign exchange market, and the fluctuations of other currency pairs usually revolve around the general trend of the euro/dollar currency pair.
In foreign exchange investment and trading practice, investors can refer to the inverted pyramid position building method and the position increase method to formulate trading strategies.
In the field of traditional stock investment, institutional investors and large fund managers often use the inverted pyramid position building method when implementing bottom-fishing operations. Based on their judgment of the intrinsic value of stocks, value investors often follow the investment principle of "buy more when the price of high-quality stocks falls" when the price of high-quality stocks falls. Under volatile market conditions, there is a limit to price declines, and each price decline will reduce the probability of further declines. Based on this, investors should gradually increase the scale of positions according to the decline, so that the amount of positions added is negatively correlated with the probability of decline, so as to optimize the risk and return of the investment portfolio.
In traditional stock investment activities, when using the inverted pyramid position building method, the investment targets need to be strictly screened. This method is usually suitable for investment products that investors have studied for a long time and have a deep understanding of their fundamentals, industry prospects and market performance. In actual application scenarios, the inverted pyramid position adding method emphasizes continuous buying during the price decline to dilute the cost, but when using it, it is necessary to fully consider market risks, changes in the fundamentals of the investment target and the sustainability of the downward trend. For example, the stock price of the once blue chip stock fell sharply from more than 40 yuan to 2-3 yuan due to intensified industry competition and mistakes in business strategies. If the inverted pyramid position adding method is blindly adopted during the decline, investors may face huge capital losses and liquidity risks due to misjudgment of the downward trend.
The core premise of using the inverted pyramid position adding method is that the investment target has the potential to bottom out or reverse. For stock investment, investors need to conduct in-depth analysis and evaluation of the fundamentals of stocks, including company financial status, profitability, market competitiveness and industry development trends, and establish full confidence in the fundamentals of the investment target.
In foreign exchange investment transactions, investors can refer to the inverted pyramid method and the positive pyramid method to build long-term investment strategies and establish historical bottom positions and historical top positions. Although these two methods are rarely mentioned in public market discussions, they are important means to achieve asset appreciation in the long-term practice of actual large foreign exchange investment institutions and senior investors. Investors who are interested in in-depth research on such methods not only need to have sufficient capital scale to cope with market fluctuations, but also need to have a long investment cycle to ensure that the holding time can cover the market cycle, and have firm investment beliefs and stick to investment strategies in market fluctuations. Only then can they effectively apply and study these two investment methods in depth.
Analysis of the advantages and disadvantages of individual foreign exchange investment traders.
I. Advantages of individual foreign exchange investment traders.
(I) Independent decision-making.
Individual foreign exchange traders have a high degree of autonomy in the process of trading decisions. They can independently decide whether to conduct transactions based on their own professional judgment and the current market situation. In contrast, traders in large financial institutions need to comprehensively weigh the guidelines and compliance requirements of upper-level regulatory authorities when making decisions, and their decision-making process is subject to many constraints.
(II) Independent operation.
Individual foreign exchange traders have absolute control over trading decisions and can strictly follow their pre-planned trading strategies and plans to execute transactions. Although large institutional traders may be more outstanding in performance presentation due to the huge amount of funds they manage, their actual return on investment may not be higher than that of individual foreign exchange traders under strict upper-level supervision.
(III) Information acquisition.
With the widespread popularization of Internet technology, individual foreign exchange traders have reached the same level as large institutional traders in terms of channels and timeliness of information acquisition. However, the convenience of information acquisition also derives corresponding challenges. Large institutions, with their abundant resources, can efficiently screen, deeply analyze and organically integrate massive amounts of information; however, if individual foreign exchange traders lack effective information management and application capabilities, it will be difficult for them to transform their information advantages into actual trading advantages.
(IV) Flexibility.
Individual foreign exchange traders show significant flexibility and mobility in trading operations, and can engage in trading activities in multiple foreign exchange markets at the same time. Due to the complex internal organizational structure and lengthy decision-making process, large institutions often need to spend more time and resources when adjusting market strategies.
(V) Self-control.
Individual foreign exchange traders have full control over their own trading behavior and investment destiny, and are less affected by external non-market factors during the trading process. However, this autonomy also means a lack of direct supervision from stakeholders, and it is very easy to make illegal or unreasonable operations such as reverse positions, heavy positions, high-frequency trading, flattening positions, and no stop loss settings in trading operations. Once an operation error occurs, it is very likely to cause serious investment losses. Large institutional traders are subject to strict internal supervision mechanisms and can effectively avoid the occurrence of extreme risk events.
2. Disadvantages of individual foreign exchange investment traders.
(I) Limited capital scale.
The initial capital scale of individual foreign exchange investment traders is generally small, with an average of about US$50,000. The limited capital scale restricts the construction and expansion of their trading positions, thereby limiting the potential profit space.
(II) Excessive trading frequency.
Some individual foreign exchange investment traders have excessive high-frequency trading during the trading process, failing to give full play to the advantages of independent decision-making and operational flexibility. Instead, they increase transaction costs and market risks due to frequent buying and selling.
(III) High commission costs.
Individual foreign exchange investment traders need to bear relatively high commission fees during the trading process. This market transaction cost structure is relatively unfavorable to individual investors and further compresses their profit space.
(IV) Large time investment.
In order to obtain comprehensive and accurate market information, learn advanced trading experience and skills, and improve their trading ability and market insight, individual foreign exchange investment traders need to invest a lot of time and energy in learning and research.
Foreign exchange investment and trading practitioners should realize the far-reaching significance of Internet technology and financial innovation for the development of the industry.
These factors provide individual investors with a more convenient way to withdraw funds, while improving trading efficiency, it also significantly enhances market liquidity.
In traditional cognition, Wall Street financial practitioners are often regarded as an elite group with excellent wealth creation ability. However, after in-depth analysis, it is not difficult to find that their success does not come from extraordinary talents, but from the unique resource advantages they have. These advantages are mainly reflected in the timeliness of information acquisition and the efficiency of transaction execution, which can ensure rapid response in the ever-changing market environment, thereby obtaining considerable returns. However, it is worth noting that these resources are usually only open to exchange members who pay high membership fees or financial institutions with large-scale trading volumes, which are difficult for ordinary investors to reach.
With the rapid development of technology and the gradual improvement of regulatory policies, the market structure has undergone profound changes. Today, the advantages of rapid access to market information and low-cost transactions are no longer monopolized by a few financial institutions, but are fairly open to foreign exchange investment and trading practitioners around the world. This transformation has broken the barriers of the traditional financial market, allowing individual investors and institutional investors to compete in a more equal market environment without the need for cumbersome license approval processes, greatly reducing the market entry threshold.
Against this background, we should fully affirm the role of the invention of computer technology, Internet technology, financial innovation and changes in foreign exchange trading models in promoting the development of the industry. It is the joint effect of these factors that has created unprecedented development opportunities for ordinary foreign exchange investment and trading practitioners. In the current market environment, it is particularly important to improve the professional and technical level of foreign exchange investment and trading practitioners, which will directly affect whether they can make steady profits in the market and achieve effective value-added of funds.
13711580480@139.com
+86 137 1158 0480
+86 137 1158 0480
+86 137 1158 0480
Mr. Zhang
China · Guangzhou
13711580480@139.com
+86 137 1158 0480
+86 137 1158 0480
+86 137 1158 0480
Mr. Zhang
China · Guangzhou