With 50,000 capital, if you only earn 2.5% per week and persist for 6 years, how much volume can we achieve?

I calculated, and the answer is 60 million.

But within this, if you only earn 2.5% a week, that is only a few tenths of a point daily.

Isn't that too little?

No.

There is an operational method internationally called the Sparrow Strategy.

In fact, this method is more suitable for retail investors and is more suitable for short-term beginners.

For beginners, there is not much understanding ability, and they cannot grasp the rapid rotation of sectors.

Following this overnight arbitrage Sparrow Strategy, we can preserve the principal while capturing small profits.

Gradually accumulate to grow larger, and it is even very likely to achieve a compound interest effect.

This set of strategies was discussed with a large institution when I was working at a trading exchange in Hong Kong. The boss said:

We manage hundreds of billions in funds, and we cannot trade frequently every day.

So we can only catch short-term profits and continuously achieve compound interest.

So how do we implement the entire strategy?

In fact, there are three models. The first model is called:

As long as it rises by 2.5% the next day, I will sell and set a direct position.

You might ask, what if you don't make 2.5%?

What if you lose again? At this time, there is also a corresponding stop-loss level, such as not exceeding a 5% loss.

In this case, there is another key point, which tests the retail investors' allocation of positions.

For example, we can't just focus on one; we can operate on 3-5 coins using this model.

The second model is called, if after opening the position, it exceeds a 2.5% return on that day, or suddenly fluctuates significantly shortly after, how should we proceed?

In this case, it is necessary to take partial profits near the previous support or upper resistance after quickly pulling the volatility.

For example, for every 10% increase, I need to reduce my position by one level.

When calculated this way, although your returns are reduced, your risks are also weakened.

Our Sparrow Strategy is mainly to withstand large risks and drawdowns.

The third model is called, what if the coin you choose is a bit stronger and shows a continuous upward trend?

There is also a strategy to hold stocks according to the three-day line; once a large volume appears at a high position, a large shadow line, or a large bearish line appears, you can sell in time.

This model, when calculated, allows you to maintain minimal losses while taking profits in batches during high returns, reducing risks.

I see you frowning, you must be wondering if 2.5% is too little, just 2.5% per week. Can you set me a return of 5% or 10% per week?

However, our data shows that many coins are difficult to rise by 10% to 30% within a day.

Unless you can select which meme coins and leading coins, but this also carries the risk of large fluctuations.

Under normal circumstances, 2.5% a day, and normally, capturing 5% to 10% over a few days and maintaining stable profits is already quite difficult.

So retail investors should not be greedy. Just think about what Einstein said: compound interest is the eighth wonder of the world.

You can calculate the 10,000 times in eight years by Zhao Laoge; the average daily return is only 0.5 points.

So retail investors in the current weak market should not rush to chase this counterfeit today, that one tomorrow, and another the day after.

Switching back and forth like this, if you get stuck at a high position, you are likely to lose 10 points.

So choose what strategy according to your own personality.

For those who are impatient and want stable profits, the Sparrow Strategy.

As long as the win rate can reach 60%, we can accumulate to 2 million from the secondary market in a year, or even reach 20 million.

So, always remember that for short-term trading, the win-loss ratio is more important than anything else. Being able to achieve small losses and large profits, controlling drawdowns, will determine whether you can trade cryptocurrencies for a living.

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