The Law of Grid Trading

Net trading requires a relatively large amount of capital, and in principle any point can be accessed, but it is important to manage funds. If the current point is difficult to judge high or low, for example, to operate one stock, you can invest half of the funds for the first time, and then prepare for a 50% decline in the stock price. Specifically, the operation is to draw a fixed grid of 5%, divide the number of shares into 10, sell one share for every 5% increase, buy one share for every 5% decrease, so that the stock in hand can cope with a one-sided increase of 10%, the capital can be paid for a one-sided decrease of 10%.¹⁄₂₀*0.04*10=2%, annual returns above 25%; conservatives say that even if the stock price fluctuation is small, hedging twice a month, the result is not worse than the bank. From the current Chinese market, no stock will be so volatile. If the index fund is better, there is no worry about fluctuations, and the processing fee is less.

The above strategies can also be optimized. For example, large grids (e.g. 10%) and small grids can be used at the same time, or the grids can be divided more finely, for example 2.5% or even 1.25%, but the hedging spread should not be less than 5%. In short, it is good to capture more volatility. This way, as long as the stock price fluctuates within the set range, it is always profitable. What do you mean? Selected stocks are based on volatile large-scale stocks and index funds, such systemic risks are less, such as China Life and Security, the current stock price is only a waistline, there will never be a situation of falling from 100 to 10. If there is a situation of a one-sided rise in the price of the stock, the annual returns have been reached in a short time, it is easy not to pursue.