Over the years, I've seen too many retail investors.

But in reality, more than 50% of retail investors are not suitable for stock trading.

Many people say that only by stepping into the pit of the stock market with real money can one know whether it's suitable or not.

But those who have stepped into the pit have basically suffered a lot of losses, some are simply unbearable to watch.

We all want to know whether we have the talent for stock trading and whether we are suitable for it. What should we do?

Then, the following two small tests, you might as well think carefully about what kind of answers you would choose.

The first test.

Choose one of the following three options.

1. A 50% chance of making 500,000.

2. A 75% chance of making 200,000.3. A 100% probability of earning 100,000.

From the perspective of the results of the probability game, if the same choice is made four times, the first type can earn 1 million, the second type can earn 600,000, and the third type can earn 400,000.

However, in reality, there are not many people who choose the first type, and most people choose the second and third types, among which the number of people choosing the second type is slightly higher than the third type.

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The reason why everyone chooses the second type is that they believe they can bear a certain level of risk, but they want to strive for greater returns.

The first type has too much uncertainty. Although it seems to make a lot of money, it seems that the risk is also too high.

The third type has too much certainty. Although it can make money, it always feels a bit little.

This is like most investors in the market are not willing to chase hot spots and gamble with hot money, believing that the probability of losing money by chasing rises and falls is high. Although the risk is lower, it is also easy to miss big bull stocks.

This is also like most investors in the market are not willing to buy bank stocks and wait for dividends, because the dividend cycle is too long, and the dividend rate of 6-7% does not look high, and there is market fluctuation to bear.

The vast majority of investors believe they have a certain ability to bear losses and want to make money through the waves of the market.

Essentially, they are more eager to make money by accumulating small profits in the waves.But the result is that this kind of thinking has the lowest probability of making money, and it often leads to a situation where you make a little money but lose a lot.

The second test.

Choose one of the following three options.

1. A 100% probability of losing 100,000.

2. A 75% probability of losing 200,000, and a 25% probability of not losing any money.

3. A 50% probability of losing 500,000, and a 50% probability of not losing any money.

Let's look at the problem from the opposite perspective. If there is a 100% chance of losing 100,000 and a 50% chance of losing 500,000, how should we choose?

From the perspective of probability theory, it is definitely best to accept the loss of 100,000 and get out, as the loss is the smallest.

But with a 50% chance of not losing any money, many people are willing to take the risk and avoid their own losses.

In reality, the same number of people choose the middle option, with a 75% chance of losing 200,000, because they always want to gamble on the possibility of not losing any money.It's like when a stock is falling, and it has clearly reached the stop-loss line, but most people still hope to wait and see if there is any chance of a turnaround.

Admitting a loss of 100,000, it's better to wait and see, in case it goes up, and you might not lose money.

This situation can happen, but the probability of it happening is indeed only 25%.

If the probability of it happening is 50%, then you should be prepared to bear the possibility of the stock being halved.

The vast majority of investors gradually lose their principal and get trapped in the deep set while waiting to take a closer look.

There is a big problem here, which is the importance of predicting errors and stopping losses.

When the stock falls, it actually proves that your judgment is wrong. How to stop the loss and how to correct the error has become a key factor.

If you rely on waiting to guess the unknown outcome, even if it goes up, it is due to luck, not the ability to judge, and it is more likely to get lost in the choice of transactions.

Of course, smart people will have a fourth choice.

Since you know that the probability of losing money in the current transaction is very high, why not choose not to trade, not to buy stocks.When you find a market with a drop of over 4000 points and the probability of making money is extremely low, the best choice is to wait with an empty position.

There is no need to hold onto your chips because the chips in your hand are likely to depreciate in the short term.

Behind the game, you need to know how much risk you are willing to bear first, and then you can estimate where your chances of winning are.

The game in the stock market is not the same as the game in the casino.

The game of guessing the two sides of a coin is actually a 50% to 50% game, but the house will take a cut, which is to say, it will charge a fee.

The game in the stock market is not a fifty-fifty game because the capital itself is not equal, which will affect the direction of the rise and fall.

Therefore, the game in the stock market is not reflected in the probability, but in human nature.

In the seemingly equal but actually unequal market at both ends of the transaction, profits are obtained by exploiting the weaknesses of human nature.

In the eyes of the main force, retail investors are a sample and big data, and everything will develop according to the worst trend in the sample.For example, there is a 75% chance of making a profit of 200,000 yuan, and only a 25% chance of losing 200,000 yuan.

However, the actual situation is exactly the opposite. This 75% is just an assumed data.

The data that is ultimately presented is at most around 40% that can make a profit of 200,000 yuan, while 60% will incur a loss of 200,000 yuan.

The fundamental reason for this situation is that the underlying trading logic is in the hands of the main force.

The choices made by retail investors based on human nature will ultimately be magnified and become fatal flaws.

In this market, there are only three real paths.

The first type is the pure low-risk investment path that relies on time to see returns.

The pure low-risk investment method is to look for listed companies with high net asset return rates and high dividend rates.

These companies are actually very valuable for investment, but the rise in stock prices is phased and volatile.

That is to say, these companies will not always rise, and they may even fall.But if one can wait for a cycle of rotation, an effective return will eventually be achieved.

From the perspective of the underlying investment logic, any listed company with long-term growth in performance will have a good rise.

However, the duration of the time cycle that will reflect the value is unknown.

Of course, there is also a key point, which is whether the purchase price is in a relatively low valuation range, which is also very important.

The second type is high risk and high return, the path of seeking market hotspots for gambling.

This path is a shortcut to success, but also a relatively large pit.

All the stock gods we see have come out of this path, but the actual proportion is very small.

Emotional perception requires a certain talent, and chasing the hotspots for gambling is actually speculating on emotions.

On the one hand, it is necessary to carefully review the market situation every day, where the hotspots are.

On the other hand, it is necessary to play with emotions, find the way out for funds, and see through the thoughts of funds.The only advantage for retail investors on this path is the small scale of their capital, which allows for quick entry and exit. On other levels, they have no advantage at all. Therefore, it is also destined that only a small number of people can succeed on this path.

The third path is to see through the tactics of the main force of capital and to follow the patient path of long-term investment. This is actually unrealistic for ordinary investors, especially beginners. It requires a long period of accumulation and long-term monitoring of the market to find the operation rules of the main force of capital.

In this market, there are actually many market makers who have long been entrenched in some individual stocks for operation, buying low and selling high. However, retail investors are actually completely unaware of this and cannot accurately monitor it.

This path can actually be tried by most investors after experiencing the bull and bear market and having a few years of stock trading experience. The difficulty is not high, but it also requires patience and attention to find many opportunities.

Investing is very difficult. If you cannot overcome human nature, it is better to stay away from the market.It's like knowing you're going to lose money, so it might as well not invest at all, at least you won't lose money, right?

First, think clearly whether this path is suitable for yourself, and then decide whether to invest heavily in doing this thing.