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How to build your own trading system (1)

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When you see stocks rise, you want to chase; when you see them fall, you panic. Or maybe you buy based on recommendations from friends or influencers, feeling happy when you profit and frustrated when you lose without knowing why. I believe many friends have had this experience. Greed and fear are instinctual human traits. It's said that the hardest part of investing is overcoming human nature. To maintain a good mindset, it's not enough to rely solely on strong mental toughness to combat human weaknesses; you also need your own perfect trading system. So, how to go about it?

First, you need to understand your investment style.
1. Suitable investment period. Are you good at short-term or long-term investments?
2. Investment type. What is the expected return and the maximum acceptable loss? Is it conservative, moderate, or aggressive?
3. Investment preference. Do you have a familiar industry or field? When choosing specific stocks, do you consider fundamental analysis or technical analysis?
By understanding these questions, we can better help you establish a trading system that matches your style.

Second, establish a trading system, which means that these questions should be considered before buying stocks, including:
1. Why buy? What are the basis and criteria for selection? (Selecting symbols)
2. Investment period? One week, one month, one year or even longer? (Confirming the cycle)
3. What price to buy? How much position to buy? Buy at once or buy in batches? (Profit and loss ratio, position management)
When to sell? There are several strategies for responding to different market situations. What ways can be used to exit? (Take profit and stop loss)
Investing actually starts at the moment of making a trading plan, not from buying. If everyone can carefully consider the above questions before each trade, I believe that they can face market fluctuations with ease and calmness.

I recently had the opportunity to study the mentor's videos and gradually started to establish a trading system. This made me realize that my previous trades were often blindly following the trend, with little to no ability to determine for myself. This year, the difficulty of investing is obviously higher than last year, so it's better to quickly improve my trading system, calm down and study hard, and become a mature and successful trader.

Wish everyone a happy trading!!
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only. Read more
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