In the trading market, significant gains and losses are common. I have previously incurred losses due to overconfidence in my operations, but I've also been fortunate enough to bottom-fish and peak-pick based on experience. However, I have not experienced dramatic events such as a blown account or a single trade doubling in value. I consider myself lucky in this regard.
I started trading stocks in 2009 and began futures trading in 2011. My approach is purely technical analysis, focusing primarily on overnight swing trades, with tailored trading systems for different instruments.
A friend's success in futures trading prompted me to follow suit, leading me into the world of futures trading. Transitioning from amateur to full-time, I grew my initial capital of 10,000 yuan to profits of 200,000 yuan. To me, the futures market is akin to a casino.
In trading, whenever I believe a particular method can be profitable, I will use it. Whenever a new method comes to mind, I test it against historical charts. If the results indicate profitability, I consider trading with that method. However, the prerequisite is a large enough sample size to prove the system's feasibility. Relying on just a few historical chart patterns to determine entry points is inadvisable, as similar formations can yield different results.
Currently, I have four trading systems, all developed for instruments with which I am well-acquainted. These systems primarily use two moving averages for analysis. My thinking is straightforward: since most market participants watch moving averages, if they see a trend and I see the same trend, and we all trade accordingly, the trend follows.
Typically, strategies developed for single instruments have short lifespans, a persistent issue for me. As yet, I have not found a better solution, so I continually research and refine my methods. Naturally, if a strategy becomes outdated, I develop a new one. To survive in this market, one must dedicate significant time and effort to learning and research.
Two factors determine sustained profitability:
Reflecting on my trading career, I am one of the ordinary traders in the futures market who makes small profits to support my family. Over the years, I turned 10,000 yuan into 200,000 yuan through in-depth research in futures investment. My journey involved study and research—simulated testing—real-time trading—losses and gains cycles—statistical analysis—further study and insights—developing a trading system—executing trades consistently—maintaining profitability.
During this time, I made losses due to overconfidence but also managed to bottom-fish and peak-pick based on experience. However, I have not experienced dramatic account liquidations or a single trade doubling in value. Generally, most investors in the market encounter significant gains and losses. I attribute my profitability to two main factors: risk control by keeping positions below 20%, and strict adherence to stop-loss signals from my system. These two practices ensure I never lose everything, and when opportunities arise, I can bounce back.
My profit expectations are modest; a single gain of 30%–40% is significant for me. Due to my low capital utilization and maintaining positions below 20%, my maximum stop-loss does not exceed 5%, with an average stop-loss of less than 3%, making large losses rare.
My risk control strategy involves managing position size. Before placing any order, I determine the maximum potential loss in points and calculate the number of contracts to keep my loss under 5%. Once prepared, I wait for the right opportunity to place the order.
Of course, consecutive losses are inevitable in trading. According to my method, even with 10 consecutive losses, the total loss would be 20%, leaving sufficient capital to recover. If each loss were 20%, a few consecutive losses would wipe out the account. So, the simplest method is to reduce the extent of individual losses.
Over the course of my trading journey, I’ve avoided being eliminated by the market, gaining valuable insights and experience. I've realized that market dynamics and price fluctuations for each instrument are constantly changing. To continue thriving, one must adapt to these changes.
For further information on trading platforms, please contact CWG Forex Platform's Ahai.
