Human Factor

Become a winning investor
From the premise made in the previous section it emerges that an investor currently finds themselves in an environment which is a perfect combination of factors that will direct them toward making mistakes in managing their finances.
In order to understand how the Uniqo protocol can be employed, it's important to establish what human factors it mitigates to make the investment safe, stable and profitable.
The main difficulties that Uniqo solves can be traced back to three spheres:
  • Technique - the search for the perfect strategy
  • Risk and capital management
  • Psychology - tranquility and the rule of sleeping at night

The search for the perfect strategy

Traders spend most of their lives in search of the perfect trading strategy, often trying to find the indicator or a combination of indicators that can provide the right reading of the market trend, which would allow them to find a long-lasting winning strategy. Very few achieve this highly sought-after goal, often finding themselves having to restart the search from scratch, whilst most end up either renouncing to the search or having to rely on an external trusted entity.

Risk management is key

This concept might be clichéd, but there is no more difficult thing to apply and it all stems from a problem related to the investor's ego. After all the effort that went into setting the perfect strategy, they won't accept the fact that they were not right. This leads them to being exposed until they profit and it often happens that they modify the risk parameters previously set in order not to see a loss realized. On the contrary, when an investor sees their position in profit and their portfolio grow they never take profit, having left the physical and mental energy to manage a position.
To tell the truth, managing is not even a correct term as the management of a position presupposes an underlying logic, whilst in these cases we are only talking about the hope that things will go as planned. And the word hope - when associated with trading - is the most evil that can happen. An operation must also be implemented by making sure that the amount put at risk allows the trader to check the asset's price action only once or twice a day. If they feel the need to continuously monitor the price trend through the use of a smartphone or computer, there might be something wrong. The amount put at risk is probably too large.

The rule of sleeping at night

The concatenation of the risks set out above causes the investor to become nervous enough to negatively affect their ordinary life. Not having a clear strategy, being exposed to excessive risk and not knowing how to manage their position, will lead the investor to live restlessly. They will assume hysterical attitudes leading them to continuously update charts and portfolios to monitor every single oscillation of their positions. These attitudes can lead to a deterioration of their psychophysical conditions, interpersonal relationships and especially a great waste of their time and money.
This background contextualization was deliberately introduced to sensitize people to a radical change in interpreting their finances. It is important to highlight - today more than ever - the different needs that each of us has. There is not just one investment recipe or motivation for everyone, but what really matters is making sense of the investment and its social and economic usefulness.