Today's Market Overview
On April 8th, the A-shares experienced a strong rebound. The Shanghai Composite Index closed up 2.69% at 3995 points, the Shenzhen Component Index rose 4.79%, the ChiNext Index increased by 5.91%, and the STAR 50 surged 6.18%. The total trading volume for the day was 2.45 trillion yuan, an increase of over 50% compared to the previous trading day, with more than 5,100 stocks in the market rising.
In terms of sectors, the four major technology sectors—communication, electronics, media, and computer—each rose over 6%, while non-ferrous metals increased nearly 6%; energy sectors such as oil, petrochemicals, and coal fell against the trend. Hong Kong stocks also strengthened, with the Hang Seng Technology Index rising 4.76%. The driving logic is clear: the ceasefire between the U.S. and Iran alleviates inflation concerns, the release of Zhipu GLM-5.1 achieves domestic large model price benchmarking, and multiple industrial catalysts such as the acceleration of CPO commercialization have led to a full-scale explosion in technology growth.
In-depth Commentary: Increasing Positions in Loss is Evasion, Increasing Positions for Profit is Cultivation
In daily investment operations, there is a phenomenon that has troubled almost every market participant: why do we always fall deeper into losing stocks while failing to hold onto profitable ones, selling too early? Behind this lies a subtle psychological mechanism.
When a position shows a floating loss, many investors' first reaction is not to calmly reassess whether the logic has changed, but rather to subconsciously seek reasons to increase their positions to average down the cost. On the surface, this appears to be a contrarian thinking of &#34;buying more as prices fall,&#34; but upon deeper analysis, it often reflects a subconscious avoidance of pain.
The pain of loss is distressing because it directly negates our initial decision-making. Admitting a loss and exiting means confronting the fact that &#34;I was wrong,&#34; which is a significant shock to anyone's self-perception. Averaging down, however, provides an indirect escape route—so long as one does not sell, the loss remains merely a paper loss; as long as the stock price rebounds, not only can I recover my capital, but I can also prove that my initial judgment was not wrong.
The deeper root of this psychological mechanism lies in the human innate tendencies of &#34;loss aversion&#34; and &#34;self-justification.&#34; Behavioral finance research shows that when people face certain losses, they often exhibit risk-seeking behavior—preferring to gamble rather than accept the established fact. Averaging down is a typical projection of this gambler's mentality in the investment field.
Even more insidiously, each time one averages down, it serves as a silent self-justification: I am not making a mistake; I am merely building a position. Once this narrative takes shape, investors can fall into a vicious cycle of &#34;buying more as prices fall, and prices fall as they buy more,&#34; until funds are exhausted or their psychological defenses collapse.
However, the market does not care about your cost basis. Whether a stock is worth holding depends solely on its future cash flow discounting, which has nothing to do with the price at which you initially bought it. When the fundamental logic has broken down and the industrial trend has changed, continuing to average down is merely sinking deeper into the quagmire of sunk costs. The sunk cost fallacy tells us that rational decisions should only consider future gains and costs, and past losses should not influence current judgments.
Yet, knowing is easy, but doing is hard; very few investors can truly &#34;forget the cost.&#34; The only correct way to face pain is to admit mistakes, cut losses, exit, and preserve capital to wait for the next truly worthwhile opportunity.
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In contrast, there is another less noticeable psychological trap—the impulse to take profits. When a position shows unrealized gains, the desire to cash in is almost a physiological instinct. Psychological research indicates that humans have an aversion to loss that is about twice as strong as the pleasure derived from equivalent gains. This means that in a state of unrealized gains, investors naturally tend to lock in profits early to avoid &#34;losing a cooked duck.&#34; This mindset may be understandable in short-term trading, but for investors entering with a medium to long-term logic, exiting too early often leads to missing out on substantial profits.
Furthermore, the impulse to take profits stems from a deeper psychological need—seeking self-affirmation. Every time one sells a profitable stock, it is a way of proving to oneself, &#34;I made money&#34; and &#34;My judgment is correct.&#34; This immediate positive feedback is pleasurable but may come at the cost of sacrificing larger gains. Those who dare to increase their positions on profitable holdings are essentially the minority willing to delay gratification and endure short-term volatility in exchange for higher returns.
What truly widens the gap in investment returns is overcoming this instinct. Increasing your position on profitable holdings means you are willing to risk sacrificing existing profits to explore the maximum potential of that investment. This is not about blindly chasing highs, but rather matching a clearer judgment with a larger position as the logic continues to be validated and the trend strengthens. Those who earn multiples or even tenfold returns on bull stocks do not rely on precise bottom fishing; instead, they dare to continuously add to their positions during the upward trend, allowing profits to run fully. Their common characteristic is that when the market proves them right, they are not eager to cash out but are willing to place larger bets.
Of course, the premise for increasing positions for profit is that the logic has not yet fully materialized. If a company's growth potential has been fully priced in, or if the industry cycle has entered a downward phase, continuing to add positions is no longer about exploring profit boundaries but rather driven by greed in taking risks.
The standard for judgment lies not in how much the stock price has risen, but in whether the fundamentals can still support a higher valuation. This requires investors to have a clear understanding of industry trends, a deep understanding of the company's competitive barriers, and a rational assessment of valuation levels. Distinguishing the boundaries between these two is the touchstone of an investor's cognitive level.
Investment Message
Investing is not about predicting tomorrow's ups and downs, but about finding those businesses that have time on your side and then quietly waiting for compound interest to occur. Slow is fast, and less is more.
Note: The market has risks, and investment requires caution. The content of this article is based on publicly available information and does not constitute any investment advice.

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On April 8th, the A-shares rebounded strongly, with the SSE Index rising 2.69% to 3995 points, the Shenzhen Index increasing by 4.79%, and the ChiNext rising by 5.91%. The trading volume reached 2.45 trillion yuan, with over 5,100 stocks rising. The technology sector performed outstandingly, with telecommunications, electronics, media, and computers all rising by more than 6%. Market sentiment was influenced by factors such as the ceasefire between the U.S. and Iran and the release of domestic large models. Investor psychological analysis indicates that increasing positions while in loss is a manifestation of avoiding pain, reflecting the psychological mechanisms of "loss aversion" and "self-justification."

Increase your position when the account starts making money!