The legendary woman who was reborn from the ashes

Chapter 12 Blue Chip Stocks - Invisible Compound Profits

Many traders simply believe that the correct trading model is to turn the market into an ATM by following a fixed trading system.

They believe that the real core of profit lies in the trading system. In fact, this view is biased because it is impossible for a long-term, sustainable and stable profit model to exist in this market.

There are many uncertain factors in the market. Any trading system has its suitable and unsuitable aspects. Everyone’s trading model cannot always be suitable for any trend. Under different trends, investors must not only switch to a trading system that suits them, but also switch to a trading model that suits the current trend.

In the trading industry, what is truly powerful is not the trading system, but the traders themselves who use the trading system.

Traders need to have enough knowledge to be able to master a trading system to make profits. It is not that the trading system itself is magical. This is no different from other industries.

Most investors enter the market with the goal of making money, and this expectation makes their chances of success very low, because this expectation makes it difficult for them to maintain a calm observation and have no patience to wait for the inevitable results.

Stock trading is so monotonous and boring, especially some new stock investors like to jump in and out of the stock market regardless of external conditions to seek excitement. When settling the market value, they suddenly realize how expensive it is to seek this excitement.

The financial market is a place where you use money to buy experience and then use experience to exchange for money.

What determines wealth more than diligence is compound interest thinking. Once you master the compound interest thinking, one year of yours will be many years for others.

After more than a decade of ups and downs in the stock market, Jiang Juan finally understood that the key to profitability is to have a stable trading system that is suitable for various trends and one's own personality. So Jiang Juan struggled to find her own trading system that was also suitable for the trend.

Jiang Juan often compares herself with her trading peers, learns from those who are better at trading, and at the same time identifies her own shortcomings.

Once when she was talking with her colleagues, she found out that during the same trading period, why was the profit of her friend's account much higher than hers?

With doubts, Jiang Juan followed her friend for a long time and found out that her friend was making long-term investments, that is, choosing blue-chip stocks.

After summarizing her past successes and failures, Jiang Juan discovered that blue-chip stocks are a simple and stable profit model for long-term investment.

This discovery made Jiang Juan so excited that she couldn't express it in words. She couldn't hide her happiness, as if it would jump out of her eyes even if she covered her mouth!

Compared with the thrilling daily limit, the operation of blue-chip stocks is more comfortable, leisurely and stable.

First of all, the sustained and stable growth of blue-chip stocks is the foundation of corporate sustainability and the charm of blue-chip stocks. Their relevant information has been made public, their performance is relatively clear, and they have the characteristics of high growth and low risk, so they have high investment value.

When the market environment is not good, blue chip stocks tend to follow the market adjustment. After a period of sharp decline, blue chip stocks with low valuations have a higher price-performance ratio. If they fluctuate sideways at the bottom for a long time, the bottom is very solid and it is easier for the market to discover and repair the valuation. Therefore, blue chip stocks provide investors with invisible compound interest profits.

As blue chip stocks for long-term value investment, one must start with the monthly line when selecting and filter out short-term daily fluctuations.

The longer the big box constructed at the bottom of the monthly line is, the better. There must be a lot of volume in the box. The greater the turnover, the better (the bottom turnover determines the future space of individual stocks). The amplitude of the box value should be less than 6 times. After that, the price must break through the upper track of the monthly box before participating.

Case: Jiugui Liquor, from October 2012 to May 10, the box oscillated for a total of 2020 months, the box value was 5 times, the turnover rate was 89%. After breaking through the box, the increase was more than 6 times in one and a half years.

(The above stock cases are past tense and do not constitute investment advice)

When investors review historical market trends, they will find that there are many such cases in the A-share market. As long as they carefully select stocks, wait patiently and seize opportunities, profits can be expected.

Afterwards, Jiang Juan used this blue chip stock trading method to achieve stable, unexpected profits every year.

From the perspective of time, blue chip stocks need to be held for a long time, and there will be many fluctuations in the middle. Compared with short-term trading, you need to have a good psychological quality, be able to withstand shocks, and be able to endure loneliness.

There are many people who want to get rich quickly in the short term, but investing to get rich must rely on long-term compound interest. Blue chip stocks are one of the most profitable models for compounding wealth.

Most of the traders who have made long-term profits in the market have accumulated a lot of experience and used compound interest thinking to make themselves stronger. Compound interest thinking is like a snowball, the bigger it rolls, the more you get.

Trading is not about constantly looking for opportunities, constantly buying and selling, and even less about watching the market all the time. Many traders wish there were no holidays and wish they could trade 24 hours a day. The more they do this, the more they lose. This is a hurdle that many traders will never be able to overcome in their lifetime.

Zhang, the leader who made 5 billion from 20 stocks, said: "He who doesn't know how to short positions will never fight!

Successful traders establish objective rules; unsuccessful traders tend to immerse themselves in the market, drifting deeper and deeper in the ups and downs of prices.

In addition to bringing Jiang Juan a lot of wealth, investing has also deepened her life experience.

You don’t need to convince anyone in your investment career. Just change yourself silently, cultivate and evolve yourself silently. The naturally formed aura will be like a magnetic field, which will involuntarily attract excellent investment concepts and ideas and integrate them into your own trading system.

Investment is a long-distance race, which tests innate conditions, acquired efforts, and mentality. When others walk slowly, you can earn excess returns if you walk faster. When others are anxious to make quick money, you can also earn excess returns if you walk slower and look further. As long as you have a calm mind and deal with it calmly, you have already won more than half the battle.

Don't use tactical diligence to cover up strategic laziness.

When you have experienced enough ups and downs, and accompanied the ups and downs of funds, your inspiration will slowly develop, and fragmented technology will form a trading model that suits you.

Strictly speaking, without three to five years of experience and without paying a thick stack of tuition fees, it is impossible for you to focus on doing the right thing at the right time.

For those "professional" stock investors, due to lack of sufficient experience to determine the right time! This requires a long and difficult learning process. There is no other shortcut except to continue to strengthen learning. Otherwise, you will overdraw your future. Behind any profitable prosperity there are unknown hardships and efforts.

There is no best idea in the world, only the most practical result. Failure only proves that the determination to succeed is not strong enough.

Failure and success have the same value. Only after finding the cause of failure can we move towards success step by step.

The market is not short of stars, but it is short of birthday stars. The road to success is not crowded because there are not many people who persist.

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