Trading Reflection Notes (1)

1. Looking back at the market conditions in January and early February, when is it more comfortable to buy put protection options? During relatively stable market periods, buying put options is comparatively cheaper. If you want to protect your spot holdings at this time, you can gradually purchase them in a dollar-cost averaging manner. My personal experience is that buying 30DTE puts with a delta of 20-30 is more appropriate.
2. The above refers to times when the market is relatively stable. Buying puts then is a form of preventive protection. If the market breaks below a certain support level, even if the options are expensive, you should still buy them. These puts can be called relief-style protection (the terms "preventive" and "relief" are actually borrowed from two methods of Federal Reserve rate cuts; I think they are quite appropriate here).
If you see that the downtrend has not ended or is still ongoing, you might not need to buy long-dated options; buying options for just one week ahead could suffice. Since your goal is to protect your spot holdings from loss, even if the options are expensive, you must buy them.
3. Clarify the primary and secondary contradictions
The primary contradiction is how much risk exposure to maintain under specific market conditions, i.e., your position size. The secondary contradiction involves technical signals provided by technical analysis or personal market forecasts.
4. A quote from Munger that should always be etched in your mind: "The astonishing thing is that people like us, simply by working hard to avoid mistakes rather than pursuing brilliance, gain such a huge long-term advantage." — Munger
In other words: avoiding major mistakes is more important than seeking brilliant predictions. Consistently avoiding big errors over the long term will naturally accumulate significant advantages.