1. Getting Started & Journey
Q: What was your motivation for entering the futures market?
A: Mainly because the stock market crashed severely before. I realized stocks were risky, while futures offer leverage and two-way trading, providing more operational space, profit opportunities, and diverse investment strategies and risk management tools. That’s why I decided to enter the futures market.
Q: What are the two most memorable trading experiences in your futures journey?
A: One was a spread trading of soybean oil and soybean meal in a certain year, which resulted in a 50% loss—the only major annual loss. The other was in a different year when the commodity market rebounded from the bottom, and I seized the opportunity to earn 3-4x returns, far exceeding any previous gains.
Q: How did your stock investment experience before futures affect your trading?
A: Not much. When I traded stocks before, I completely followed tips and news, lacking a systematic investment philosophy or strategy. After entering the futures market, I began systematically learning technical analysis, fundamental analysis, and gradually built my own trading system.
2. Trading Strategies & Operations
Q: What was your specific trading strategy during the commodity market’s low-point rebound?
A: The overall commodity market was at a low point then, with many commodity prices depressed. My strategy was relatively simple—mainly selecting commodities with solid fundamentals and technical buy signals to hold. The good returns had some luck involved.
Q: How do you combine technical analysis (primary) with fundamental analysis (secondary) in actual trading?
A: For example, when trying to catch the top, I first use fundamental analysis to determine if a commodity is overvalued, then combine with technical analysis to find suitable selling timing. When prices surge wildly beyond a reasonable range and technical indicators show clear reversal signals, I execute the sell.
Q: You split subjective and objective trading 50/50. How do you balance them in practice?
A: Balance mainly depends on market opportunities. When there are obvious big trends, I lean toward subjective trading and increase positions to capture opportunities. When the market is volatile with no clear trend, I rely more on technical analysis for objective trading to control risk.
Q: What are the core principles and logic of your manual trading system?
A: The trading system is centered on moving averages, combined with price trends and volume indicators for comprehensive judgment. The logic is relatively simple, but execution requires strict discipline and patience. I believe simple systems are often more effective—complex systems may contain too much noise and uncertainty.
Q: You primarily do medium-to-long term trading with occasional arbitrage. What factors do you consider when selecting arbitrage opportunities?
A: Mainly the price spread factor, comparing with historical extreme spreads. I also pay attention to market dynamics and fundamental changes, because the market is constantly evolving—some related varieties’ spreads may reverse.
Q: What factors do you consider when selecting futures varieties to trade?
A: On one hand, I look at the variety’s past price performance. On the other hand, I consider the variety’s future price expectations.
3. Risk & Capital Management
Q: What lessons and reflections did your major loss experience bring?
A: I deeply realized that even highly correlated varieties can have prices that deviate significantly. In subsequent trading, I paid more attention to risk management and stop-loss settings, no longer relying solely on correlation between varieties for arbitrage. I also strengthened fundamental market research to fully grasp market dynamics.
Q: How do you balance capital growth and drawdown control?
A: Capital growth is the more important goal, but I also recognize the importance of drawdown control. Excessive drawdowns affect mindset and subsequent operations. I’m still finding a better balance between the two.
Q: When capital experiences large drawdowns, what measures do you take to adjust your capital management strategy?
A: First, I review my trading strategy and positions. I stop loss and reduce positions on losing trades promptly. At the same time, I become more cautious in selecting trading opportunities to avoid getting into a passive situation again.
Q: What are your阶段性 capital growth goals, and how do you achieve them?
A: The阶段性 goal is to achieve 26% annual returns, leveraging compound interest—doubling in 3 years, achieving 10x in 10 years. The method is mainly to capture one big market opportunity each year, which can generate good returns.
Q: How do you allocate capital across different varieties and trading opportunities?
A: In programmatic trading, capital is usually evenly distributed across different varieties. If a particular variety has an exceptionally large opportunity, I allocate a larger position based on the risk-reward ratio—既能分散风险，又能抓住大机会.
Q: How do you specifically control risk in actual trading?
A: Multi-variety allocation is an important method of risk control. By diversifying investments across different varieties, I reduce the impact of single variety volatility on overall capital. At the same time, I set strict stop-loss points to limit potential losses.
Q: How do you set stop-loss and take-profit points, and what is the basis?
A: In programmatic trading, I basically use a “close and reverse” strategy for stop-loss points. In subjective trading, I mainly set stop-loss and take-profit points based on price trends and key support/resistance levels, relying primarily on technical analysis and market experience.
Q: When突发情况 or extreme market conditions occur, what adjustments do you make to your risk management strategy?
A: Basically no adjustments, because the time-tested trading system can handle most market conditions. In extreme cases, I might temporarily adjust positions or stop-loss points to应对风险.
Q: How do you evaluate a trade’s risk-reward ratio, and under what circumstances would you abandon high-potential but high-risk trades?
A: When evaluating, I comprehensively consider the potential upside and downside space, as well as my personal risk tolerance. If the risk of a trade clearly exceeds its potential return, or if it goes beyond my risk tolerance, I abandon the trade.
4. Market Trends & Outlook
Q: What is the current overall trend and main opportunities in the futures market?
A: Currently, metals are performing relatively strongly in the futures market. These varieties are heavily influenced by factors like global economic recovery and inflation expectations, creating many trading opportunities.
Q: What are your expectations and outlook for the future futures market, and will you adjust your trading strategy?
A: I expect the market to continue maintaining volatility and uncertainty. I will continue moving forward according to my own trading goals and strategy, not making significant adjustments easily. At the same time, I will respond flexibly to market changes and continuously optimize my trading system.
5. Investment Philosophy
Q: How did your investment philosophy of “wanting to profit from others’ losses” form?
A: I once had a thought—that most retail investors are in a losing state, so perhaps I could trade in the opposite direction of retail investors. But the reality is complex, and this approach is quite difficult to implement.