The market has been scorching hot recently, with stocks, precious metals, and various assets almost simultaneously reaching record highs. Global markets are performing strongly, and the buzz about the second half of the bull market is growing louder. This is when it's easiest to get caught in a trap.

History has left us a profound lesson. In 1720, the South Sea Company in Britain, with its trade privileges in South America and government backing, became the object of nationwide pursuit. In half a year, its stock price soared from 128 pounds to over 1,000 pounds, an increase of nearly 8 times. Even Newton was tempted.

His operation seemed perfect: buy low at 7,000 pounds, double the stock price, then decisively take profits, netting 7,000 pounds. But here’s where the problem arose — he missed the subsequent rally, watching the market continue to surge, and anxiety overwhelmed his rationality. At the last moment, he invested his ten years’ savings (20,000 pounds) all at once at the peak.

The ending is well known. The South Sea Bubble burst instantly after the bill was introduced, and the stock price plummeted. Newton not only lost all his previous gains but also his principal. He later said a famous quote: “I can calculate the orbits of celestial bodies, but I cannot calculate the madness of mankind.”

Three hundred years have passed, and while market tools have evolved through generations, human nature remains unchanged. Greed, fear, and especially the anxiety of missing out are still the biggest enemies for investors. Ordinary people should not expect to precisely time the top or bottom.

The real secret to risk control in a bull market is actually very simple: control your position size. No all-in — that’s the first rule. When the market is hottest, you should start reducing your holdings; take profits when you can. Always keep some cash in your account, which not only gives you the confidence to buy the dip during pullbacks but also provides a psychological safety net. This is the difference between experts and rookies.