Warren Buffett's Untold Secrets - How To Make Steady Profits From Stock Trading

Most investors are in and out of the stock market as frequently as bees picking flowers, but they fall into losses that they cannot extricate themselves from, even somewhat inexplicably. Therefore, investors must measure the following points if they want to have the ability to make consistent and stable profits. The correct method of speculation is the key to profitability, to see the right trend to win, to win wealth.

1, Substantial success rate.
A truly sure investment opportunity does not come along every day, sometimes not even a few times a year, and we must try to be careful before investing and enter only when we are very sure. In other words, you need to be able to guarantee a minimum of 30% substantial success rate before entering the market, and it is important to wait and see when the chances of success are not high.
2, Risk/profit ratio.
The correct choice of risk to profit ratio depends on the actual success rate of our investments. As an example, i have had a success rate of roughly 35% in the past, which means that i have been successful in one out of every three investments. If you want to make a long-term profit you have two options, 1: Increase your success rate and 2: Only invest in stocks that have a high upside. It is not easy to continue to increase the success rate, I cannot achieve two or half successes out of every three investments. So, it is necessary to find ways to invest in stocks with higher yields.

This is because we usually set a stop loss at 4%-5% of the investment loss and generally do not enter the market if the risk is higher than this percentage of loss. So, you could say that the cornerstone of every successful operation is basically to build on a loss of about 8%. (Since we call any failure to reach the expected minimum rise an unsuccess, there are times when even being wrong does not result in a loss, so the material loss is often less than 10%.) so to have long-term profitability, you must have a minimum of 20% profit margin when correct before you can consider entering, and never consider entering at less than this rate of return, as entering means an eventual loss on the trade. I therefore trade at a minimum risk to profit ratio of 1:4 every time.