In trading and investing, maintaining financial security and mental health is the key to long-term success.

In trading and investment, maintaining financial security and physical and mental health is key to long-term success. Here is a brief analysis of these principles:

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1. Only use spare money, do not trade on borrowed money.

Reason: Trading on borrowed money magnifies risks. Once the market fluctuates, losses may be unbearable, even affecting personal or family finances.

Consequences: Losses not only bring economic pressure but may also lead to psychological panic, resulting in incorrect trading decisions.

Principles:

Only invest with 'spare money', meaning that even in case of total loss, it will not impact the quality of life.

Avoid using leverage or borrowed funds, especially in highly uncertain market conditions.

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2. Do not let trading interfere with daily life.

Issue: Many traders are excessively obsessed with market fluctuations, frequently checking their accounts, affecting work, family, and personal time.

Impact:

Decreased work efficiency affects sources of income.

Tense family relationships, life imbalance.

Recommendation:

Develop a trading plan, set entry, take profit, and stop-loss points to reduce meaningless screen time.

Set specific trading times to avoid letting trading occupy all free time.

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If you are having trouble sleeping and it affects your health, temporarily empty your position and exit the market.

Issue: Market fluctuations can easily trigger anxiety, especially when losses increase or trends are unclear, leading to lack of sleep and excessive mental stress.

Importance of Health: Physical and mental health are the foundation of trading. Without a good state, it is difficult to make rational decisions.

Solution:

Resting with no positions: Temporarily exit the market, adjust your mindset and physical condition, and wait for an opportunity to re-enter.

Reducing position size: If you cannot completely exit, you can reduce your position to alleviate psychological pressure.

Reflect on the issue: Through a retrospective analysis, identify the causes of anxiety, whether it is due to improper strategy or excessive position size, in order to optimize your trading plan.

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Summary

Trading should be based on spare cash, avoiding borrowing and excessive use of leverage.

Do not let trading disrupt the normal rhythm of life, maintain a balance between work and life.

Once trading affects health and sleep, it should be adjusted in time, keeping the position empty for rest, preserving health, in order to fight in the market for the long term.

Trading is a marathon, only by maintaining a good state and discipline, can one go further in the market.