From Liquidation to Financial Freedom: Capital Management is the Ultimate Secret of Trading
That Night When My Account Went to Zero
March 12, 2020, this day:
BTC price crashed from $7900 to $3800
My account: 200,000 principal instantly went to zero
Fatal mistake: single-coin position as high as 35%, leverage 5 times
Post-Analysis:
If the position is controlled at 10%: only a loss of 70,000
If the leverage is controlled at 2 times: the account could still have 120,000
The Mathematical Truth of Capital Management
Loss Recovery Formula:
Loss Ratio Required Profit Recovery Real Meaning
10% 11.11% 1 limit-up is not enough
20% 25% 3 limit-ups
50% 100% Doubling to break even
Case Comparison:
Player A: single-coin 50% position, one mistake results in a 50% loss
Player B: single-coin 10% position, same mistake only loses 10%
Result: Player B only needs 11.11% profit to break even, Player A needs 100%
My Capital Management Rules (Validated by 20 Million Assets)
1. Three Principles of Position Control:
Single-coin position ≤ 10% (Mainstream Coins)
Single-coin position ≤ 5% (Altcoins)
Total leverage ≤ 3 times
2. Dynamic Adjustment Formula:
Initial Position = (Account Balance × 2%)/(Stop Loss Margin × 2)
Example: 100,000 account, 5% stop loss
= (100,000×0.02)/(0.05×2) = 20,000
3. Black Swan Defense System:
Keep 30% USDT never to be used
Set overall account -15% automatic circuit breaker
Reduce leverage by 50% before major events
Goldman Sachs Trader Position Template:
Account Size Single Transaction Risk Maximum Position Leverage Limit
<100,000 ≤2% ≤20% 5 times
100,000-500,000 ≤1.5% ≤15% 3 times
>500,000 ≤1% ≤10% 2 times
My Improved Version (For Cryptocurrency Use):
On the above basis, halve the position
In extreme market conditions, further reduce leverage by 50%
2025 Latest Risk Warning
Current Market Status:
BTC Volatility: ±3.5%/day
Exchange Contract Position: Historical High
Suggested Actions:
Mainstream Coin Position ≤ 8%
Leverage below 2 times
Keep 40% cash
Remember:
In the crypto world, choice is greater than effort!
Follow the right people, making money is a natural outcome!
Like + Follow Longmen = Open the Door to Wealth!
