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Forex multi-account manager Z-X-N
Accepts global forex account operation, investment, and trading
Assists family office investment and autonomous management

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In foreign exchange investment trading, one of the biggest detours that traders take in their trading careers is to believe that there is absolute certainty in the market.

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This misunderstanding often leads traders to be overconfident in their ability to accurately predict market trends when facing market fluctuations, thereby ignoring the uncertainty and risks of the market.
In the trend of foreign exchange investment trading, a common trading strategy is to buy up on pullbacks. The core of this method is to choose to place many small positions at the moment of sudden dive and retracement during the trend rise, and wait for the market to pull back to these order prices to enter the market in batches. In this way, traders hope to gradually accumulate positions until they reach the long-term rising target and sell them all at once, thereby obtaining considerable profits. However, this method seems to have certainty, but in fact the market is uncertain and there is a possibility of a sudden reversal of the trend.
Similarly, in the trend of foreign exchange investment trading, pullback selling is also a common strategy. Traders will choose to place many small orders at the moment of each sudden surge and retracement, and wait for the market to pull back to these order prices before entering the market in batches. In this way, traders hope to gradually accumulate positions until they reach the long-term decline target and then sell them all at once. However, this method also has risks, because the market trend may suddenly reverse, causing traders to face huge losses.
Therefore, in the face of this uncertainty, traders need to adopt a cautious strategy. Using position layout without leverage is an effective way to deal with it. In this way, traders can find relative certainty in uncertainty, reduce risks, and avoid potential catastrophic consequences caused by excessive leverage. Although this strategy may not achieve extremely high returns, it can protect the trader's principal to a certain extent and keep it stable in market fluctuations.

In foreign exchange investment transactions, if high-frequency quantitative investment institutions begin to prevail, the first to be impacted will be the trading groups that rely on graphic analysis, that is, graphic or morphological investors.

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The trading systems of these investors are mainly based on the observation of candlestick charts, patterns, moving averages and various technical indicators. However, quantitative investment institutions use advanced algorithms and technology to have a strong ability to recognize patterns, which puts graphic or pattern traders at a disadvantage when facing quantitative algorithms.
Quantitative algorithms have significant advantages in pattern recognition, and their accuracy is unimaginable. This algorithm can quickly analyze a large amount of historical data, identify complex graphic and pattern patterns, and make trading decisions based on them. In contrast, graphic or pattern traders only rely on visual judgment of graphics and patterns, which cannot be compared with quantitative algorithms in terms of speed and accuracy. Therefore, when high-frequency quantitative investment institutions rise, graphic or pattern traders are easily left behind by algorithms.
However, graphic or pattern traders are not without opportunities. If they add some logical or elastic factors, that is, elements that are difficult for quantitative algorithms to handle, to the observation of graphics and patterns during trading, they may gain an advantage. For example, combining non-quantitative factors such as macroeconomic data, market sentiment, and news events can provide a more comprehensive perspective for trading decisions. Although these factors are difficult to be fully captured by quantitative algorithms, they can become important decision-making bases for human traders.
Therefore, graphic or pattern traders need to increase their research and decision-making dimensions, and no longer rely solely on graphics or patterns. By integrating multiple analysis methods and information sources, they can improve the accuracy and adaptability of trading decisions, thereby gaining a foothold in the competition with quantitative algorithms.

In foreign exchange investment transactions, traders first need to clarify their identity: long-term foreign exchange investors or short-term foreign exchange traders.

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This identification is crucial for the subsequent selection of trading strategies and technical expertise. Long-term investors usually focus on the long-term trend of the market, while short-term traders focus more on capturing short-term price fluctuations. After clarifying their own identity, traders can better position their technical expertise, whether they are good at short-term foreign exchange trading or long-term foreign exchange investment.
After traders have determined their identity and technical expertise, they need to position the current foreign exchange investment market. The market can be divided into a rotational market and a continuous market. A rotational market usually refers to a short-term, speculative market, which is more suitable for short-term traders. The continuous market tends to be more long-term and stable, suitable for long-term investors.
If the current foreign exchange investment market is a rotational market, that is, a short-term speculative market, then long-term foreign exchange investors should give up the continuous approach, and even choose not to participate in the market temporarily. Because long-term investors are good at finding opportunities in a continuous market, and short-term ups and downs are not in line with the goals of long-term investors.
For foreign exchange investment traders, first determine whether the market is rotational or continuous, which is itself a probabilistic judgment. If the dominant force in the market is high-frequency quantitative algorithmic trading, then the short-term market in the rotational market is often difficult for ordinary traders to participate. In this case, forcibly participating in the market is tantamount to contributing traffic to high-frequency quantitative algorithmic trading. Therefore, the right choice is to avoid participating in short-term speculation, focus on long-term stable trading, and avoid being harvested by quantitative trading.

In foreign exchange investment transactions, traders need to clearly distinguish between position management and fund management. Although the two are closely related, they are essentially different.

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Position management mainly focuses on the amount of funds invested by traders in a single transaction. For example, assuming that the trader's account funds are 1 million US dollars, then in a transaction, whether to invest 100,000 US dollars or 200,000 US dollars, this is the scope of position management. The core of position management is to control the risk exposure of a single transaction and avoid huge losses due to excessive leverage of a single transaction. Reasonable position management can help traders remain stable in the face of market fluctuations. Even if a certain transaction suffers a loss, it will not cause a devastating blow to the overall account.
And fund management is more macro, it involves the arrangement and allocation of all funds of traders. Fund management needs to consider the source of funds, such as how much bank deposits there are, how much disposable cash there is, and how much funds can be used to invest in the market. In addition, fund management also needs to consider the financial security of traders, such as whether they have left enough daily expenses for themselves and their families for 3 to 5 years. The purpose of fund management is to ensure that traders will not fall into financial difficulties due to improper fund arrangements when investing, and to provide stable financial support for trading activities.
In short, position management is risk control at the trading level, while fund management is the overall planning at the financial level. The two complement each other and are indispensable. Only when traders do a good job of position management and fund management at the same time can they achieve long-term and stable development in foreign exchange investment transactions.

In foreign exchange investment transactions, the main goal of quantitative investment algorithmic trading is to defeat retail foreign exchange investment traders, especially those who frequently engage in short-term transactions.

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This is because quantitative investment algorithmic trading uses advanced technical means and complex mathematical models to quickly analyze market data and make trading decisions, thus gaining an advantage in short-term trading. In contrast, ordinary retail foreign exchange investment traders often lack these technical means, so they are easily harvested by quantitative investment algorithmic trading institutions in short-term trading.
The main practice of quantitative investment algorithmic trading is to use the advantages of short-term speculation and quantitative algorithms, that is, the advantages of new technology, to harvest ordinary retail foreign exchange investment traders who do not understand new technology. These institutions can capture market fluctuations in a short period of time through high-frequency trading and complex algorithmic models to make profits. However, long-term foreign exchange investors usually adopt a strategy of holding light positions for a long time, and it is difficult for quantitative investment algorithmic trading institutions to harvest them. Long-term investors hold positions for a long time, and even if there is a floating loss, they will not easily stop losses, so they are not the main counterparties of quantitative investment algorithmic trading institutions.
From the long-term perspective of foreign exchange investment, foreign exchange long-term carry investment seems to be doing value investment and has a positive contribution to financial stability. When the central bank raises interest rates to curb inflation, long-term foreign exchange investment traders continue to buy the currency with the interest rate hike, which is actually helping the central bank achieve its policy goals and contribute to curbing inflation. From another perspective, long-term foreign exchange investment traders earn long-term accumulated overnight interest by continuously buying the currency with the interest rate hike, which is also one of their investment strategies.
In contrast, quantitative investment algorithmic trading institutions are simply using high-tech means to make money and have not made any contribution to financial stability or curbing inflation. Their main goal is to make profits through complex algorithms and high-frequency trading, rather than supporting the stability of the financial market through long-term investment. Therefore, from a macro perspective, the main role of quantitative investment algorithmic trading institutions is to harvest short-term retail foreign exchange traders, rather than providing stable support for the financial market.

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13711580480@139.com

+86 137 1158 0480

+86 137 1158 0480

+86 137 1158 0480

Mr. Zhang

China · Guangzhou

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