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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 forex trading, investors should adhere to the strategy of "cutting losses and letting profits run." This isn't always the right approach.

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When investors misjudge the market's broader trends, they should promptly cut losses to prevent further losses. However, when investors correctly judge the broader market trends but face temporary losses, they should hold on and wait for further market developments.
Forex traders need to have keen discernment, knowing when to decisively cut losses and when to remain patient and avoid blindly cutting losses. This is a fundamental skill that every qualified forex trader should possess. Investors should not be misled by one-sided and ill-considered terminology in the forex trading world, but should make decisions based on their own analysis and judgment.
In forex trading, cutting losses and letting profits run is about cutting losses caused by misjudging the broader market trend. For positions that are currently losing money despite having a correct outlook, it's important to hold on to them rather than blindly cutting losses without analysis or reflection. Forex traders who lack even this basic knowledge, common sense, skills, and psychological skills are undoubtedly unwise.

In forex trading, investors generally don't let certain stock jargon or sayings blind them.

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For example, the famous stock jargon or saying, "Cut losses and let profits run," while plausible, actually discusses mindset management and investment psychology. For those who have actually invested, this phrase isn't often used in practice and may even come across as uninformed.
In reality, whether it's stocks, futures, or forex, even if you've correctly identified the market direction at the beginning of your position, the market trend will inevitably experience a pullback. This is because it's rare for a trend to break through for several consecutive days without a pullback. Therefore, the phrase "cut losses and let profits run" isn't often used in real-world investing; it reflects the genuine experience of experienced investors.
In practice, investors should hold onto positions with floating losses until the market trend is correct. Once the position stabilizes, then let profits run. The specific approach is to continually build and increase positions with small amounts, then continue to hold onto positions with floating losses until the position stabilizes, then let profits run. By repeating this process, after several years, when the trend approaches a historical peak or bottom, close the accumulated large position, thus ending this long investment.

In forex trading, the rapid development of the internet has broken down information barriers, but it has also brought numerous negative consequences.

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On the one hand, the internet's convenience allows forex traders to open and place orders anytime, anywhere, on their computers or mobile phones. While this convenience lowers the barrier to entry, it also makes high-frequency trading more likely. High-frequency trading often involves heavy positions, and most retail forex investors have limited funds. Heavy positions often mean using high leverage. High-leverage trading carries significant risk and can easily lead to margin calls or liquidations, ultimately forcing investors to quickly exit the forex market.
On the other hand, while the internet has broken down information barriers, the impact of information, news, and information on long-term forex trading is very limited. In reality, breaking down information barriers has not significantly helped long-term investment. On the contrary, the internet's convenience has facilitated the spread of misleading investment concepts.
For example, the idea that "stop-loss orders must be used when opening a position" is widely promoted in forex trading, but this concept is not applicable to long-term investment. The forex market is a narrow-range market, and frequently setting stop-loss orders can often lead to unnecessary losses.
In fact, long-term, light-weight investment can better cope with both short-term losses and short-term gains, eliminating the need for constant stop-loss orders. As long as investors maintain a light position, they can achieve long-term success. However, the misguided notion that "stop-loss orders must be used when opening a position" is widely promoted daily, preventing investors from developing the correct long-term, light-weight investment philosophy. Consequently, they continue to struggle with losses until their initial capital is depleted and they ultimately leave the forex market.

In the context of forex trading, the term "carrying a position" applies only to short-term trading, specifically referring to the irrational persistence of holding a position when it incurs a loss.

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In the context of long-term forex investment, when investors accurately judge the long-term market trend, floating losses during the holding period are not considered "carrying a position" but rather normal floating loss holding behavior consistent with investment logic. There are fundamental differences between the two in trading logic and operational rationality.
Long-term forex investment places stringent demands on the comprehensive qualities of participants. Whether one can steadfastly hold a position during a reasonable period of floating losses not only tests an investor's professional knowledge, market experience, and operational skills, but also relies on their understanding of investment common sense and psychological control. The combined effect of these qualities directly determines whether an investor can adhere to a correct holding strategy until a trend becomes clear.
Notably, incorporating a carry strategy into long-term investments significantly enhances investors' ability to maintain a position through reasonable floating losses. The sustained positive interest rate differential accumulated during long-term investment not only generates substantial incremental returns but also provides investors with visible positive feedback through daily interest calculations, psychologically strengthening their confidence in the correct holding strategy and forming a dual support mechanism of "trend identification + profit accumulation."

If funds from stop-loss orders and margin calls ultimately flow into the pockets of forex trading platforms, traders should be wary and question the validity of investment strategies that encourage overnight wealth and require stop-loss orders.

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In forex trading, fostering a long-term investment mindset and abandoning short-term trading is key to the healthy and orderly development of the forex market.
However, the reality is that most novice forex investors enter the market with the dream of getting rich overnight. They crave quick wealth through forex investment. However, the forex market is inherently low-liquidity, low-risk, and highly volatile. This is primarily due to the fact that central banks in major countries around the world maintain a narrow range of exchange rates to maintain financial stability and balance of trade.
This dream of getting rich overnight contrasts sharply with the narrow fluctuations inherent in the forex market. To attract new investors to open accounts, forex brokers often unconsciously exaggerate the possibility of getting rich overnight in their marketing, appealing to their novice investors' psychology. However, in free forex training sessions, brokers often emphasize the importance of using stop-loss orders when opening trades. This contradictory promotional approach creates a conflict of opinion among novice investors. Due to limited funds, novice investors often use leverage to pursue high returns. However, using high leverage in short-term trading can lead to overnight losses. As the counterparty to the trader, the funds from the liquidation ultimately flow into the platform's pockets. Some novice investors may realize that short-term trading is difficult to profit from, and may even initially consider long-term investment. However, the narrow range of fluctuations in the forex market, coupled with the principle of always using stop-loss orders, makes it easy for accounts to be stopped out if stop-loss orders are set too narrowly, and the funds lost will ultimately flow into the broker's pockets. In fact, long-term investors who identify the right direction, avoid using leverage, avoid setting stop-loss orders, and maintain a small position size can usually withstand floating losses and ultimately achieve long-term profits. The key to successful long-term investment lies in persistence and accurate directional judgment. Forex brokers promote the dream of getting rich quick and emphasize the need to use stop-loss orders, inadvertently creating a double blow: hitting both short-term traders and long-term investors. This is precisely why the forex market is so stagnant today, and why both short-term and long-term investments are unprofitable. Due to the lack of new investors entering the market, the forex market has lost its vitality and become as quiet as water.

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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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