One day after lunch, Wen Ping was chatting with a trader working on the trading desk of MIB. The topic came to whether chartists can predict market directions and make money.
The trader suddenly said, "Do you know what is the market-making mechanism for those small to mid-size stocks that MIB is dealing with? It's to let everyone feels the pain. Computer can sum up all the open positions and find the maximal pain point. If they long positions, keep dropping prices; If they short, keep raising prices, till they give up and lose in the end. Only a few people can overcome this: those who have more money than us, and those who have more patience than us. No pain, no gain. That's it."
Being a novice then, Wen Ping was shocked and did not say anything for a little while.
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