Retail investors cannot compete with the main forces; this is an undeniable fact that does not need to be debated.

In general, people believe that retail investors cannot compete with the main forces for two reasons.

First, the disparity in capital.

We usually think that the capital of the main forces and retail investors determines the gap between the two.

The main force capital, due to its large volume, can easily influence the trend of stocks.

Retail investors have a small capital volume and can only follow the main force to share the spoils, and cannot predict the direction of the market.

Therefore, the rise and fall of the main force are always right, while retail investors cannot accurately predict every time.

The gap in capital volume is an insurmountable gap in the trading market, and the big fish eating the small fish is inevitable.

Of course, large capital has its advantages, but it also has disadvantages.

That is to say, the gap is not one-way, there are also negative times.For instance, when facing a major bear market, large capital has no way out, while retail investors can quickly liquidate their positions.

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For example, when there are significant sector shifts, large capital finds it difficult to adjust positions quickly, while retail investors can respond swiftly.

View the issue of capital volume dialectically, leverage advantages, and this gap is not as terrifying as it seems.

Secondly, there is a gap in the information chain.

The information that retail investors receive cannot be said to be second-hand; it might be third, fourth, fifth, sixth, seventh, or eighth-hand.

Describing ordinary retail investors as being at the bottom of the information chain is the most fitting.

The reason retail investors have a gap in the information chain is that their channels for obtaining information are delayed.

Therefore, insider information is destined to be out of reach for retail investors; they are all lies woven by the main forces.

This information gap is an inevitable part of trading and is an insurmountable chasm for retail investors, more terrifying than the issue of capital volume.

The essence of investment is, in fact, the difference in information.Exploiting the asymmetry of information to conduct transactions first will definitely result in better buying and selling prices than those who are late to the game.

This natural barrier dooms the main force to profit more and lose less, while retail investors can only lose more and profit less, due to the asymmetry of information.

Of course, not all information is known to the main force ahead of others; there are also some public news that everyone knows at the same time.

Being half a beat slow is an inevitable result of information asymmetry, but the real key is how retail investors make choices after receiving the information.

The difference in information and capital seems to be the essence that retail investors cannot overcome the main force, but in fact, it is not.

In reality, the biggest difference between the main force and retail investors is actually in emotions and execution.

Emotions and execution actually complement each other.

Because emotions are unstable, execution is poor, and the probability of making mistakes is high.

Just like when retail investors are still busy typing on the keyboard to vent on the Internet, the main force has already been studying how to cut leeks on the other side.

What retail investors like to do is vent emotions and strive to find an outlet for emotions.The main force likes to do is to face the current market and find strategies to deal with it.

Once people have emotions, they will lose their execution ability. Some things that they know are wrong will still be done with emotions, and they cannot control themselves.

It's like, even though it has fallen a lot, it is unbearable to bear the emotional pressure brought by the daily decline, and choose to stop loss and leave.

Similarly, a stock has risen very high, but it is unbearable to see it continue to rise, and will hold a fluke psychology, thinking that they are not the last one to take over, and follow the trend to buy.

Emotion and execution ability determine that ordinary retail investors cannot compete with the main force.

At the same time, you will also find that those retail investors with more stable emotions, they are more likely to lose money, and the probability of making money is higher.

The market is such a rule, this is the real difference between the main force and retail investors.

The main force is to touch the emotions of retail investors to manipulate the market, to stand in a more favorable position, to use the emotions of retail investors as a risk mark and opponent, and to make money in the fluctuations.

90% of retail investors, it is difficult to solve the problem of emotions and execution ability, so what should be done?The following points may not fundamentally change the retail investor group, but they can change individual retail investors.

1. Repeated training.

What is repeated training? It is actually trading training.

Trading is nothing more than buying and selling. The more you do it, the more proficient you become, and the corresponding emotions become more numb.

Those professional traders, or operators, did not have such good psychological quality from birth. They were also trained time and time again.

Of course, the effects of simulated trading and actual trading are also different.

The effect of simulated trading training will be somewhat worse. If you do actual trading more, your psychological endurance and stress resistance will naturally be much better.

Old investors are not easily impulsive because they have experienced more storms, are used to it, and their mentality naturally becomes more balanced.

2. Control your position.

If you can't control your emotions, control your position well.Do not keep money in your account; this method is the best.

Alternatively, consider purchasing some reverse repurchase agreements or money market funds, at least to prevent redemption on the same day.

Do not always think that this moment is an opportunity that must be seized; there are plenty of opportunities, and you never need to worry about missing out.

If you cannot control your hands, let your position manage it.

When you are rational, allocate your positions well, ensuring that your positions are within a reasonable range and that you do not have too much spare money for trading.

3. Trading plan.

The so-called trading plan is actually not making trades outside of the plan.

For example, if the stock you want to buy has not reached the desired buying point and suddenly rises, do not chase the rise.

Any trades outside the plan should be abandoned.

Since trades outside the plan do not match one's own predictions, not making the trade is the correct approach.Do not impulsively change your trading plan, as this will lead to the loss of trading principles and the failure of trading strategies.

Acting on a whim is actually the root cause of retail investors being "harvested" and is also the key for main funds to target retail investors' emotions.

4. Engage in more post-mortem analysis.

Engaging in more post-mortem analysis is very necessary for retail investors and is also an important method to calm their emotions.

In the market, due to the fluctuation of stock prices, retail investors are emotional.

After all, seeing a rise will bring joy, and seeing a fall will naturally bring discomfort.

But post-mortem analysis is completely different, because the stock prices are no longer fluctuating, and we can view what happened today more calmly.

Post-mortem analysis can help investors understand the market situation and the stock situation, thus making more effective judgments.

Through post-mortem analysis, one can see many things that are missing in the market, because the main funds' tricks to confuse retail investors are too many.

The so-called, those who are in the midst of the situation are confused, while those who are on the sidelines are clear.The onlookers are those outside the game, while the players are those within the game.

For retail investors to stand out in trading, improving their emotions is a necessary condition, which allows them to effectively execute strategies, and this is very important.

Otherwise, you will always be manipulated by the main force.