For most investors, the stock market can be described in five words.
It's hard to live.
But for a small group of people, they have turned the stock market into an ATM.
Although this part of the population accounts for a small proportion, have you ever wondered why they can make money, and some of them make a lot of money.
Many people will mention the trading skills, mentality, strategies, experience, methods, and models of stock trading.
None of this is true, and none of this is true.
Because in essence, people who really make money, especially those who make a lot of money, understand what they want to make and what they can make.
The amount of money that can be made in the stock market can be roughly divided into three categories.
The first category is the money that pays dividends.
This is best understood as the annual dividend paid by listed companies.
Many people have prejudices and misunderstandings about dividends, thinking that they must be ex-rights and pay taxes.
But in fact, the dividend money is the best money in the stock market, and it is relatively stable.
Most people who like to buy high-dividend listed companies for investment, even if they are not rich, have achieved stable profits.
The essence of this kind of money is one of the underlying logics of stock investment, listed companies make money and give it to their shareholders.
However, in a market with a high P/E ratio, the amount and proportion of dividends will be relatively limited.
Moreover, 1-2 dividends per year, if the dividend yield is not as good as bank management, it will make people feel worthless.
There is patience to earn dividends, this kind of shareholders actually account for a very small proportion, and they are also in the long river of time, missing an opportunity to make slow money steadily.
The second category is fluctuating money.
98% of retail investors rely on market fluctuations to make money.
To put it simply, it is to make a difference.
The essence of stocks, no matter what kind of money you make, can basically be understood as making a difference.
But the most difficult thing to make the difference is to make fluctuating money.
There are some stockholders who easily understand making the difference as making short-term money, and making fluctuating money as short-term, which is a fatal mistake.
Fluctuating money is not as simple as doing short-term.
Here's an example.
When the fundamentals of a listed company have not changed much, the stock price will fluctuate due to market factors.
At this time, most investors can choose to buy low and sell high to make money.
Volatility here refers to the price change due to the inflow and outflow of funds.
The price of a stock is not just a periodic change, but fluctuates every day.
Many retail investors like to do T intraday to make the difference, which seems to be a good way, but in fact it is difficult to make money.
It is very difficult for retail traders to judge the highs and lows of the day's prices every day.
A good quantitative strategy can capture the corresponding highs and lows through models and probabilities, but most retail investors can only rely on experience to try again and again.
Small money exists in volatility, but big money certainly exists within the trend.
Because the direction of fluctuations is not in the hands of retail investors, that is, retail investors make money from fluctuations, and they are more inclined to gamble.
It's just that retail investors think that their experience in the market can make them stand on the side of the advantage in this game.
This kind of misconception will only make retail investors farther and farther away from making money.
The earliest market was the Zhuang model, and slowly due to the increase in capital and volume, it evolved into a heli speculation model and a brainless quantitative model.
But no matter what kind of model, making fluctuating money is constantly escalating for retail investors.
If one day, the T+0 and price limit restrictions are relaxed, it means that the end of making fluctuating money has really arrived, because it means that the bigwigs in the market have no way to make volatile money.
The third category, the trend of money.
There is a big essential difference between trending money and fluctuating money.
There may be a trend that only goes in but not out, or only goes in and out.
To put it simply, if a listed company has sustained high growth, a lot of funds may buy it and hold it for a long time, and they will become long-term shareholders of the company and will not sell shares.
Similarly, if a listed company goes downhill, a lot of money may not be able to come in and out, and give up paying attention to the company.
The so-called trend is not only reflected at the level of listed companies, but also at the level of the industry, and even short-term speculation is also a trend.
For example, a large number of retail investors have fled the stock market, and a large number of funds have fled the stock market, which is also a trend.
When this trend occurs, the market will have a long-term decline because there is less capital.
Trends are an amazing thing because everything comes down to trends.
A stock has seen a short-term rapid rise because money is chasing it.
And the pursuit of funds for it has actually formed a trend.
We all know that when stocks go up, we will do a lot of things to find out why, why they are up.
And there will be a large number of small essays in the market to explain, attracting funds and retail investors to follow the trend and follow, which is also a trend.
When we say trend, we mean the direction of the wind on one side, not the divergence that has formed a fluctuation somewhere.
The biggest difference between the two is that the trend is unstoppable, while the uncertainty of the volatility is high.
For example, if a retail investor wants to sell high and buy low once, he is actually making a trend judgment twice.
It is necessary to judge not only the short-term trend downward, but also the medium- and long-term trend direction to go up.
The smaller the trend, the more difficult it is to judge, because it is all decided in the hands of funds.
Therefore, most retail investors lose money in the constant market volatility before the trend comes out.
Have you ever wondered why the vast majority of people in a bull market make money?
Because in the general trend of that environment, funds do not dare to cut leeks at will.
They are also concerned that if they throw away their chips when the market is volatile, they may not get them back.
Under this large-scale trend, everyone can make money, but this money is only a book number.
When the trend ends, whoever can cash in on the profit is the winner.
In a bear market, it's exactly the same.
Retail investors always feel that someone makes money in a bear market, but there is almost no one who really makes a lot of money in a bear market, and it is also impossible to make money because of the trend.
There are still some people who insist that it is useless to judge the general trend, and the selection of stocks is the most important.
It sounds reasonable, but it's all nonsense.
If the general trend is not stable, how can there be time and space for speculation for funds to commit crimes against the wind.
There are no programmatic documents that indicate where the trend is, and how can there be so much money for unprovoked speculation.
Trends are really worth studying for everyone.
He is not only present in the stock market, but in every corner where he makes money.