Replenishment is a passive coping strategy after being trapped, which is not a good way to break free in itself, but it is the most suitable method in certain specific situations. How can novice stock traders replenish their positions? Regarding how to replenish positions for novice stock traders, the following are the precautions for how to replenish positions for novice stock traders.
Due to the continuous sharp decline of the market, many investors are deeply trapped. It should be acknowledged that effective replenishment is one of the important ways to self rescue, but many friends are not very familiar with the specific operation. Here are some tips for novice stock traders on how to replenish their positions.
How to replenish positions for novice stock traders?
1. Prevent complacency and regret.The index rises or falls when it is not replenished after a successful replenishment; Regretting the decline or rise of the index after replenishing the position. These are all major taboos for replenishment operations. The correct attitude is to establish a planning concept, formulate operational strategies, be calm and composed when replenishing positions, and neither feel proud nor regret after the operation. This is something that novice stock traders must know how to replenish positions.
2. Prevent greed and fear.Investors with a tendency towards greed and fear dare to buy stocks when they rise, and hope for them to rise after buying. At this time, they have obvious greed, but when a stock falls, they dare not replenish their position. If they have already replenished their position, they are afraid of falling. At this time, they have obvious fear. Greedy and fearful investors always hesitate or chase after gains and losses, making it difficult to make quick decisions and achieve a relatively low probability of investment success.
3. Prevent going to extremes.There are two extreme manifestations: one is that the more it falls, the more it is replenished, but the necessary position control is ignored, resulting in a high proportion of holdings in a certain variety; The second reason is that as the price rises, it sells more and more, but neglects the bottom position (long-term variety), ultimately leading to the loss of chips. The effective solution to this problem is to consider both the decline of individual stocks and the proportion of positions when replenishing. Investors can set a limit buying quantity before replenishing their positions based on the principle of buying more as the price drops. Generally, the limit buying quantity is one-third to one-fifth of the total position for a single product. This is a point that novice stock traders should pay attention to when replenishing their positions.
4. Prevent haste and instant benefits.Don't expect a sharp rise immediately after replenishing your position and a drop immediately after selling. Maintain a calm mindset. Although replenishing your position may cause a certain degree of "loss" compared to not replenishing it, the cost is much cheaper compared to the previous buying price and other people's buying prices. Moreover, in this mindset of replenishing positions and patiently holding them, investors often receive unexpected surprises and higher returns at low expectations.
Being good at picking opportunities to replenish positions after the decline of the overall market and individual stocks is an important tool for investors to successfully buy at the bottom or rescue themselves after being trapped. Whether investors are trapped at high levels or successfully escape from the top, they should develop the habit of replenishing positions at low levels and be good at buying stocks at low levels.