[Red Envelope] The first article of the Year of the Horse: Reflecting on trading in the era of quantification—say goodbye to old models, embrace a new ecosystem!

[Taoguba]

Tomorrow marks a new beginning in the Year of the Horse. Heartfelt wishes to all new and old friends following Brother Ding: May 2026 bring you good luck in the Year of the Horse! May your account stay in the green!

In the past year, have you reflected on every trade? Has your account curve experienced sharp fluctuations? Can your trading pattern achieve stable compound growth? Quantitative dominance has become the norm in the ecosystem. Are you still complaining? What is the core competitiveness of short-term trading in the quantitative era? Are you still obsessed with consecutive limit-ups and chasing leaders? Are these questions worth deep thinking?

Self-Reflection in Quantitative Trading: Say Goodbye to Old Methods, Embrace the New Ecosystem!

Over the past year, the market environment has undergone profound structural changes. Quantitative funds have become the dominant force, the short-term ecosystem has been completely reconstructed, and previously reliable trading strategies have frequently failed. Countless traders have fallen into confusion amid oscillations and drawdowns. Standing at this new juncture, it’s necessary to thoroughly review and question your trading behavior, system, and understanding: Did you reflect on every trade? Did your account curve fluctuate sharply? Can your trading pattern achieve stable compound growth? Quantitative dominance has become the norm. Are you still complaining? What is the core competitiveness of short-term trading in the quantitative era? Are you still fixated on consecutive limit-ups and chasing leaders? These questions are not just simple self-inquiries but core issues that every trader aiming for long-term survival must face, think about deeply, and answer.

First, whether each trade is reflected upon determines its value for growth.

Many people trade frequently every day, hundreds of times a year, yet never truly review a single trade calmly. Profits are attributed to good eyesight; losses are blamed on bad luck, market traps, or big players. Such trading is essentially ineffective repetition. Genuine trading growth never comes from quantity but from quality—deep reflection after each opening, holding, and closing: What was the entry logic? Was the stop-loss strictly executed? Was the take-profit reasonable? Did emotions interfere with decisions? Did news resonate with the market? Only by transforming each trade into a replicable experience or a lesson to be corrected does trading gain meaningful accumulation. Trades without reflection merely consume capital, time, and mental energy. Even occasional profits are just luck, not ability. In an uncertain market, the only certain path to growth is trading with reflection, summarizing to optimize, making each operation part of a system rather than impulsive emotion.

Second, whether the account curve fluctuates sharply is the only standard to measure trading maturity.

An account curve with big swings, rapid rises and falls, indicates unstable trading patterns, uncontrolled position management, and lack of risk control. Many traders pursue short-term high profits, aiming to double their money in one shot, but ignore the smoothness and stability of the curve. The cruel truth of the market is: high profits are unsustainable, and drawdowns can be fatal. A large drawdown may require multiple or even dozens of profitable trades to recover; a smooth upward curve, even with slow gains, can achieve compound growth over time. Sharp fluctuations are essentially traders betting against the market and fighting against human nature, ultimately being punished by the market. Mature traders always prioritize controlling drawdowns and maintaining steady curves over chasing profits, because they understand that survival is more important than earning more, and longevity is more critical than rushing ahead.

Third, whether the trading pattern can achieve stable compound growth is the dividing line between experts and gamblers.

Most people in the market remain in a cycle of “profit and loss, going nowhere,” mainly because they lack a repeatable, executable, positively profitable trading system. Stable compound growth is not a myth but an inevitable result of systematic trading. It doesn’t require catching every limit-up or buying at the lowest and selling at the highest; it only requires a pattern with positive expected value, capable of long-term adherence and strict execution. Whether it’s trend following, swing trading, or low-buy arbitrage, as long as the pattern is validated by the market, can control losses, and amplify profits, it forms the basis for compound growth. Trading without a pattern is like sailing a boat without a rudder—lucky in favorable winds, doomed in headwinds. The core of compound growth isn’t how strong your profit-making ability is, but how consistent your ability to repeat it. When your pattern can deliver stable results day after day, week after week, profits will naturally follow.

Fourth, quantitative dominance has become the norm. Complaining will only lead to market淘汰; adapting is the way to survive.

Today’s A-share market sees quantitative funds occupying half of short-term trading volume. Algorithms have replaced human emotions; high-frequency trading has rewritten volatility patterns. The old rules of consecutive limit-ups, leader strategies, and sentiment cycles are frequently invalidated by quant strategies. Many traders complain: “Quant funds are harvesting retail investors,” “The market has no humanity,” “Short-term trading is impossible…” But complaints won’t change reality. The market is always right; the ecosystem is always evolving. Refusing to adapt to new environments will only lead to elimination. Quantitative isn’t the enemy but a new market participant; it’s not risk but a new trading variable. Truly mature traders don’t oppose the environment but study quant rules, leverage quant features, and avoid quant risks to find a space for manual trading in a machine-led ecosystem. Accept change, respect rules, and adapt to the ecosystem—these are the first survival principles in trading.

Fifth, in the era of quantification, the core competitiveness of short-term trading is no longer emotional betting but cognition, discipline, and risk control.

In the past short-term ecosystem, making quick gains through chasing limit-ups, relay strategies, and emotional trading could yield high returns. But today, dominated by quant strategies, these logics are completely invalid. Quant funds rely on speed, algorithms, and probability advantages to crush pure emotional trading. So, what is the core advantage of manual short-term trading? The answer: human advantages that algorithms cannot replace—strict trading discipline, advanced macro cognition, refined risk management, and asymmetric risk-reward management. Machines have no emotions, but lack a big-picture view; they execute discipline but can’t understand policy trends or market fundamentals; they pursue high frequency but can’t stick to long-term certainty. The value of manual trading lies in avoiding the areas where quant dominates, focusing on logical predictions, trend turning points, and structural opportunities that machines find hard to cover—using patience instead of frequency, discipline instead of impulsiveness, cognition instead of gambling. In the quant era, short-term trading is no longer about courage but about vision; not about speed but about cognition; not about aggression but about safety.

Finally, obsessing over consecutive limit-ups and chasing leaders is a thing of the past. Traders must upgrade their models.

For a long time, relay limit-up strategies were regarded as the holy grail of short-term trading. Many obsessed with catching leaders, making consecutive limit-ups, and chasing涨停. But in today’s ecosystem, the height of limit-ups is continuously compressed, relay premiums are greatly reduced, losses from chasing limit-ups are common, and leader traps are frequent. Clinging to old methods is essentially mental rigidity and ignoring market changes. The market is changing; strategies must change. The ecosystem is evolving; models must upgrade. Currently, short-term opportunities are more often found in low-buy arbitrage, trend following, structural moves, and swing holdings rather than pure relay battles. Let go of your obsession with limit-ups and leaders, shift to more stable, safer, and ecosystem-compatible models—that’s the way to break through. Sticking to the past only leads to continuous losses; embracing change is the way to regain profits.

In summary, these series of soul-searching questions point to one core: The essence of trading is self-evolution, adapting to the market, and winning through systems.

Past gains and losses are history; future profits depend on today’s cognition and change. Refuse to reflect, and you cannot grow; refuse stability, and you cannot compound; refuse adaptation, and you cannot survive; refuse upgrading, and you cannot break through. The quant era is not the end of trading but the start of a new cognitive competition. True traders never complain about the environment or dwell on the past. Instead, they optimize through reflection, stay steady amid volatility, evolve through change, and build a sustainable, compoundable trading system in this new era.

The market always rewards those who keep learning, think deeply, discipline themselves strictly, and keep pace with the times. May every trader awaken through reflection, improve through change, and in the new market ecosystem, walk steadily and far, with long-term compounding profits.

Extra notes:

The author has been a full-time trader for 6 years, with 11 years of trading experience. Skilled at perceiving subtle market changes and foreseeing market patterns. Expert in analyzing index, thematic, and sentiment cycles. Low-buy models are increasingly refined, and I am well-versed in low-buy strategies in Taoxian, earning a stable monthly profit of 20%, with an annual compound of 8 times. 15% monthly profit yields 4 times annual compound; 10% monthly profit yields 2 times. My desire isn’t high; a steady 10% monthly is enough. More than that is just gratitude for the market’s reward! Maintaining a good mindset, treating trading as a joyful activity—why not? The best offense is defense: control emotions, manage positions flexibly, enforce strict position management, and control drawdowns. Slow is fast; compound growth will expand your imagination! How many leaders can relay in a year? It’s a dead-end path—9 out of 10 relay players fail; surviving one is genius! I successfully transitioned from relay chasing to understanding the market deeply. No need for chasing limit-ups; market understanding is key! Trading is a contest of market cognition. Only by standing shoulder to shoulder with high-cognition traders can you see the market’s essence, avoid risks, and grasp wealth trends.

Follow us—our connection is fate. Ideas are countless, but only your frequent likes, tips, and encouragement keep you on track. Giving is receiving; your support is also recognition of my ideas. My pre-market insights are truly golden, waiting for you to discover! Wishing all friends in 2026 a continuous rise in accounts and steady growth!