Source: red and green

Abstract: if I told you that someone was afraid of making a profit, would you believe it? You may think this is a little absurd. Isn't the purpose of our transaction to make money? How can anyone still be afraid of making a profit. In fact, the survey shows that many traders suffer from this psychological torment: fear of loss and fear of profit.

Many people may not understand the meaning of fear of profits. before you explain this concept, recall whether you have ever done the following when trading:

1. After placing an order, he couldn't keep his temper. He always looked at his account every once in a while. Once he had a surplus, he began to worry about profit vomiting, thinking that it would be safe to drop into the bag as soon as possible.

two。 It is rare to go in the right direction and set the stop profit, but the closer the market is to the stop profit point, the more nervous you will be, and you will not be able to touch the stop profit immediately, or even fear that the market will suddenly turn around, give up the stop profit, and come out early.

3. After a series of profits, instead of sleeping better, you often worry about waking up and going back to square one. This worry often causes you to stay awake at night, check your account over and over again, and end up leaving early.

All of the above are signs of fear of profit, or more accurately,I am afraid to keep the profits I get.As a result, we may have missed the bigger market in the future.

In psychology, this phenomenon has a more professional term, called "Jonah complex".

The fear of making a profit is even worse.

In fact, it is easier to worry about gains and losses than losses, becausePeople subconsciously regard the surplus on their books as "their own money".The pain of losing 100 yuan is greater than the pleasure of getting 100 yuan.How much confidence and joy your account brings to you, how painful it is when you give it back.So after the book is full, repeated shocks bring more fear to traders than joy.

In this way, leaving early seems to be a way to avoid pain. In fact, it is not, because it is OK to stop profit ahead of time, once it is wrong, it may bear greater pain and regret later.

Because traders leaving early may lead to missing out on a better market, that is, picking sesame seeds and losing watermelons.

Some people may be more Buddhist and think it doesn't matter. But most people will definitely regret this situation, because human nature is still greedy, especially when it comes to money. According to your plan, a deal that would have earned 10% ended up earning 5% or less. I believe that most people will regret this situation.

BecauseThe most painful thing in life is not failure, but that I could have.

In addition to the consequences mentioned above, the greater harm of the fear of profit lies ahead for traders.

One of the basic features of Jonah complex is to avoid growth.This is fatal for a person who wants to trade for a living, because it will prevent you from going further down the road.

Fear of profitability may sometimes allow you to avoid a pullback and keep some of your profits. However, from a long-term point of view, this is not a good thing, but a bad thing.

Even if you stop the profit ahead of time, the market really reverses. At this time, apart from feeling lucky, most people must feel that it is wise to show up early. This will give people a lot of confidence that their trading level has improved again.

But in fact, your early appearance is only because you are worried about profit recovery, not because of your grasp of the market. So,You are likely to fall into blind optimism and self-confidence and misjudge your abilities. When a person overestimates his ability, he is not far from losing money.

Coming out early for fear of profit will also interrupt our trading plan. We have already made a trading plan and set up entry, exit, stop profit and other points. But once the profit is settled in advance, the plan will be disrupted, which is not conducive to us to build and improve our own trading system.

In this way,Fear of making a profit looks like a small profit, but it is actually a big lossIt allows traders to unwittingly avoid growth.

The root cause of fear of profit

After understanding its harm, we have to find the root cause of this negative psychology and find out how to deal with it.

Traders are afraid of making profits mainly because of their lack of self-confidence. This lack of self-confidence may come from the following aspects:

1. There is no trading system, or the system is unstable

two。 Have false expectations

3. Not familiar with the variety you trade.

4. Do not have a correct understanding of their negative emotions

We will not explain the above four reasons in detail here, and then we will mainly talk about how to overcome this bad mentality.

(1) relax the state of mind and treat profits and losses correctly.

Since it is a matter of mentality, our first consideration is of course to find a solution from the perspective of mentality. Whether we hate losses or fear profits, we should first relax our mindset and learn to face profits and losses more calmly.

This may seem simple, but anyone who has made a deal knows that it is not easy to do. Because we face the fluctuation of money, it is difficult to ignore it, especially when the money is relatively large. Therefore, to learn to face profits and losses calmly, you can try to reduce your position, light trading, even if there are floating profits and losses, it will not make people mood swings.

In addition, we can also deliberately play down the importance we attach to floating profits and losses and repeatedly emphasize to ourselves in our hearts that floating profits and losses on the books are all normal situations, that they are just the process of trading, and that what we pursue is long-term results. The profit and loss of a transaction is nothing, let alone the floating profit and loss generated in the course of the transaction.

This depends on long-term practical training. The longer people trade, the more they are used to the rise and fall of account funds, and the more peaceful they tend to be in the face of floating profits and losses.

(2) make a plan and strictly abide by the transaction discipline

Clear plans and goals can sometimes avoid a lot of impulsive actions. Many people may not have a clear plan when trading, but follow their heart, feel that it is time to enter the market immediately, and then feel that something is wrong and leave immediately.

In the face of this random situation, we need to make a plan, strictly abide by the trading discipline, and firmly follow the signals sent by the trading system. The system tells you to reduce the position when it is time to reduce the position, feel at ease to hold the position when it is time to close the position, and do not have too much hesitation when it is time to close the position. Everything is operated according to your own plan, rather than a random operation of the mind.

If we can make sure that every trading step has enough logical support, even if we lose money, it is only a perfection of the trading system. In this way, we can avoid too much emotional interference in the trading process.

(3) keep looking back and face up to negative emotions.

Review after each transaction, in-depth analysis of the reasons behind the profits and losses of each transaction, so that we can find the problem in a timely manner.

It is worth noting that in retrospect, we should dare to admit and face up to the existence of negative emotions, and learn to reflect on the reasons behind and try to find countermeasures. When we find ourselves leaving early for fear of making a profit, we can keep asking ourselves: why was I scared at that time? Is it because of some emergency or is there another reason? Does this kind of fear often appear? How should I overcome it? People's psychology will have a tolerance period, through deliberate training and training can weaken the impact of negative emotions on trading.

(4) set a reasonable expectation.

As mentioned earlier, false expectations can also make traders afraid of making profits. Because if traders are too eager for quick success and quick profit in the early stage, always pursuing "top" or "bottom", they are often more likely to fail. After a few failures, traders often change their mindset and begin to be afraid of profits and think of falling into their pockets as soon as there is a surplus.

The market situation is unpredictable, "buy at the lowest point, sell at the highest point" is as difficult as finding a trading holy grail. Don't be too greedy in trading, it's good to be able to catch the market in the middle. Therefore, we should set a reasonable expectation when trading, so that we can not only have a realistic position to stop profits, but also get a reasonable return.

(5) understand the characteristics of the market and make familiar varieties.

Each market and trading variety has its own rules, some fluctuations are already relatively large, while others are very sensitive to fundamentals. For example, the volatility of dollar straight currency pairs is generally higher than that of cross-trading. If you do not have a clear understanding and grasp of these most basic market characteristics, you will enter the market hastily and will easily be led by the nose by a little bit of floating profits and losses.

Summary

Fear of profit is a bad mentality that will have a negative impact on trading, but at the same time, it is also a common psychological state in our daily transactions. Even if the account is still profitable, it will be sold in a hurry for fear of giving up all the profits in the end. Once you leave the market, the cost of getting it back is likely to be much higher, unless you are convinced that the stock market will usher in a deep correction.

No matter what we do, we want to make a profit, first of all, we should not be afraid of making a profit, let alone avoid the "fear" itself, but should face this mentality squarely and overcome it.

Edit / Jeffy