Survival in Trading: Breaking the Retail Investor Dilemma from the Mathematical Roots
The Cruel Truth of Compound Interest
1. Loss Recovery Formula Table:
Loss Percentage Required Recovery Percentage
10% 11.11%
20% 25%
30% 42.86%
50% 100%
70% 233%
2. Capital Defense Golden Ratio:
Single Loss ≤ 2% of Total Capital
Daily Loss ≤ 5% of Total Capital
Monthly Loss ≤ 15% of Total Capital
Professional Trader's Stop Loss Rules
1. Three-Level Stop Loss System:
① Technical Stop Loss (below previous low by 3%)
② Time Stop Loss (holding position for 30 minutes without profit)
③ Psychological Stop Loss (when self-doubt occurs)
2. Dynamic Take Profit Reference Table:
Profit Margin Stop Loss Adjustment
5% To Cost Line
10% Retain 5%
20% Retain 12%
50%+ Retain 30%
Breaking the Retail Investor Death Loop
1. Typical Psychological Traps:
"It has already dropped so much, it won't drop again"
"Just wait a bit longer, I will definitely recover"
"This time is different"
2. Survival Adjustment Plan:
Pre-set mechanical stop losses
Profit exceeding 20% should immediately withdraw capital
Daily trades ≤ 3 times
Capital Revival Equation
1. Recovery Combat Plan:
After a 50% loss:
Reduce leverage to 1/4 of the original level
Single trade risk ≤ 1%
Target monthly return 5%
2. Compound Growth Model:
Monthly Return Rate 1 Year Compound 3 Year Compound
5% 79.6% 340%
10% 214% 1745%
15% 435% 6252%
2025 Practical Rules
Intelligent Stop Loss Tools:
Exchange Automatic Stop Loss Orders
Volatility Triggered Stop Loss (3x ATR)
Large On-chain Transfer Alert Stop Loss
Based on Account Status:
1. If loss exceeds 20%, immediately reduce position by 50%
2. Pause for 1 week after 3 consecutive stop losses
3. If profit reaches 30%, withdraw 50% of profit
Remember:
In the crypto world, choice is greater than effort!
Follow the right people, making money will be a natural outcome!
Like + Follow Longmen = Open the Door to Wealth!
