Forex multi-account manager Z-X-N
Accepts global forex account operation, investment, and trading
Assists family office investment and autonomous management
In foreign exchange investment and trading, operations can still be carried out even without indicators.
In the absence of technical analysis indicators, it is completely feasible to successfully conduct foreign exchange trading. For the information provided by the trading platform, everyone's way of interpreting and applying is unique. If technical analysis indicators do not play any role for investors, then these indicators can be chosen not to be used. Others should not dominate an investor's trading settings, and investors should not blindly follow others' opinions. The core goal is to determine a trading system that suits one's own situation.
In foreign exchange investment trading, the SSI (Speculative Sentiment Index) reverse indicator can be cleverly used.
The SSI sentiment indicator is the abbreviation of Speculative Sentiment Index. In the field of foreign exchange trading, if most traders adopt a long strategy, then selling operations should be chosen at this time; on the contrary, if most traders are short, then buying should be considered. This trading strategy can be explained from the level of market speculation, that is, most participants usually suffer losses, and only a few people can make profits. Under normal circumstances, buying operations can be carried out when the ratio is less than 40%, and selling operations are implemented when the ratio is greater than 60%. The key lies in the fact that the ratio differences of brokers or currency pairs with poor liquidity are extremely significant, so filtering must be carried out by raising the entry threshold. For example, buy when the ratio is less than 30% and sell when the ratio is greater than 70%. If it involves currency pairs for long-term carry trade investments, such as yen currency pairs, this strategy needs to be used with caution.
In the field of long-term foreign exchange investment trading, except for one or two specific trading systems that have practical value, the rest of the trading systems can be largely regarded as lacking practical utility.
In the same way, except for one or two key trading indicators, other various trading indicators can basically be considered as having no practical significance. However, currently it seems that few people know this situation exactly or truly understand its inner meaning. Those who can fully understand and clarify this principle can be considered to be in a state of enlightenment.
For long-term foreign exchange investment traders, studying the Kelly formula may not be a wise choice in many cases.
In the formula f* = p/a - q/b, f* represents the optimal betting ratio, p is the probability of winning, q is the probability of losing, a is the net return rate when winning (that is, the ratio of profit to principal after winning), and b is the net loss rate when losing (that is, the ratio of loss to principal after losing).
From the perspective of investment philosophy, simplicity is the ultimate sophistication. Complicated investment tools and methods often may not achieve the expected results in practical applications. Taking long-term foreign exchange carry trade as an example, long-term carry trade investment can be summarized by a relatively simple formula, that is, long-term carry trade investment = savings interest + growth profit from bottom fishing or top fishing. This formula is concise and clear, easy to understand and apply.
When making long-term foreign exchange investments, investors should remain rational and avoid being misled by formulas that seem useful but have poor practical effects. Formulas that cannot bring actual returns have limited value in investment decisions and can be regarded as tools without practical application significance.
We should focus on investment methods and strategies that have been proven through practice and are practical and feasible to achieve long-term stable investment returns.
Is the compound interest formula the main reason for deceiving short-term high-frequency foreign exchange trading or ultra-short-term high-frequency foreign exchange trading?
Compound interest refers to when calculating interest. The formula is: F = P(1 + r)^n. Among them, F represents the final value, that is, the value at a specific time point in the future; P represents the present value, that is, the initial principal amount; r represents the interest rate (usually expressed in decimal form); n represents the number of interest calculation periods.
For example, if you currently have a principal of 10,000 yuan and an annual interest rate of 5%. The investment period is 3 years. Then, according to the compound interest formula, the final value is calculated as: F = 10,000 × (1 + 0.05)^3 = 10,000 × 1.157625 = 11,576.25 yuan.
Compound interest has powerful strength. As time goes by and the number of interest calculation periods increases, the principal will grow at an accelerating speed. In the fields of financial planning and long-term investment, the compound interest effect is often used to achieve wealth accumulation.
However, there are also views that compound interest is somewhat controversial in the financial world and is even regarded as a "scam". Many acts of promoting compound interest may have basic logical errors in algorithms. The logical error of the compound interest paradox mainly lies in the fact that low interest rates and situations with large fluctuations are difficult to support the so-called "miracle". To achieve significant results, one must have sufficient principal. Compound interest also involves three important factors: First, the rate of return needs to be relatively high. For example, in real life, a relatively high rate of return (such as a specific high percentage rate of return) is often difficult to achieve for large amounts of funds. Second, the principal must be sufficient. If there is only tens of thousands of yuan in principal, the total amount of compound interest growth will be very limited. Third, the time span must be long enough. Usually, it is difficult to see a significant gap within a few years. At least after ten years, the gap will gradually appear, and the longer the time, the greater the gap.
In long-term foreign exchange investment, the carry trade strategy is relatively close to the principle of the compound interest formula. Only the currencies of emerging countries may have this advantage, but the growth is not exponential. Because even if you hold a carry trade position for three years, according to the formula F = P(1 + r)^n, this n is not equal to 3 but is equivalent to 1, that is, a long-term carry trade investment. In this case, the role of this formula is not as powerful as expected.
So, is the compound interest formula the main reason for luring short-term high-frequency foreign exchange trading or ultra-short-term high-frequency foreign exchange trading? If so, the compound interest formula will undoubtedly become a super trap because short-term trading is usually difficult to succeed.
13711580480@139.com
+86 137 1158 0480
+86 137 1158 0480
+86 137 1158 0480
Mr. Zhang
China · Guangzhou
13711580480@139.com
+86 137 1158 0480
+86 137 1158 0480
+86 137 1158 0480
Mr. Zhang
China · Guangzhou