Grasp the investment psychology and temper the winner mentality

Most investors have the experience that when choosing between two stocks, they tend to choose the one with the lower price, because the price is acceptable to most people, and they are unwilling or afraid to buy the higher price. The truth is that stocks that are acceptable to the majority may not rise, while stocks that are not acceptable to the price may keep rising. Why is this so? In fact, it is a matter of investor mentality.

Mentality is a person's usual psychological feelings, a kind of understanding and reaction to things, and a person's mentality can determine their ability to play. In the investment market, the psychological state will determine the entire trading level and the "feeling" of trading. As the above example shows, investors' "fear" psychology is at work,CBCXforeign exchangeMake them like to buy stocks with cheap prices and small gains when choosing, because such stocks are safer. For stocks with high stock prices, they believe that the upward space in the later stage is limited, the risk of a correction increases, and they are afraid of a correction and get stuck at a high level. In fact, investors have forgotten the true meaning of investing at this time, that is, in the process of investing, we should pay attention to the trend, the so-called "focus on the trend and not the price". When the trend is determined, we must conform to the direction of development of the trend, and the price is the secondary consideration.

We also often hear shareholders sigh: "Alas, the stock that has just been sold goes up as soon as it is sold, and the one that has just been bought goes down as soon as it is sold, as if an eye is staring at its own account. How is it so accurate?" The reason is that when the market fluctuates repeatedly, investors see that the market is not good and are unwilling to buy; when the stock price starts to rise after the shock, investors realize that the stock price will rise and rush to buy. But after buying, the stock price began to adjust, and the investor's mentality deteriorated. When he saw another stock rising, he went to change the stock again, but unfortunately, the stock he had just bought also began to adjust, while the one he had just sold began to rise again... So, in the end, the market rose a lot, but many people did not make any money in the exchange. Why is it so difficult to master the seemingly simple buy and sell? In fact, investors have a "impatient" mentality during the investment process, and it is this mentality that causes investors to frequently chase up and kill, and make mistakes. This is an old saying: "Money is not in a hurry". When investing in stocks, not only good skills and methods are required, but also a good attitude is required.

Once upon a time, there was a psychological analysis experiment conducted on investors, and its conclusion to the winners was that no matter when, no matter how much they lost, no matter what kind of predicament they were in at that time, their mentality remained unchanged. On the contrary, the psychological diagnosis of failed investors shows that when they lost money, their pulse and blood pressure will rise sharply. This shows that mentality is the key to the success of an investor. If you can relax your mind during the investment process and treat trading as a process over time, a profit and loss does not represent true success or failure. Even if the market goes against each other, you can stay calm and have a purpose. This is a bit difficult to do, but this is the difference between success and failure.

Although we can't decide the rise and fall of the stock market, we can control our own behavior and not be affected emotionally. This is a kind of ability that we gradually develop. Learning how to control our own mentality allows us to be relaxed, confident, and always in control of the overall situation during the trading process.