Herding effect: the theory of foreign exchange trading

herding is a term used in investment, which mainly refers to the phenomenon that investors learn and imitate in the process of trading," there is a kind of learning "and blindly imitate others, so that they buy and sell the same currency pair in a certain period of time. There are a group of foreign exchange investors in Mingming's family. They have a network and a computer, but they just like the atmosphere of "getting together". They think that the transaction needs to be discussed. Before the transaction, they can listen to your opinions more, and they have a bottom in their heart. What's the point of doing this? Most people don't make money, but everyone will feel more confident than they are in trading at home. Where does that come from?

most of the people are blindly following suit. When all the members of the whole group suffer losses, your pain will be greatly reduced as one of them. Moreover, you are likely to follow suit. This is only the wrong judgment of others, and you have less self blame. On the contrary, when the group's decision is right, but you have different independent judgment If the loss is caused, the psychological pressure will be greater. But the trader misunderstood the real meaning of the transaction. The purpose of the transaction is to make profits, not to feel pleasure.