After playing contracts for so many years, friends always ask me if I can hold positions and if I have stop-losses. Many strategies may work in the short term, but the biggest enemy in the long term is the transaction fees + slippage!
Every strategy has its time sensitivity; at this moment, there is no one-size-fits-all trading system! The market is ever-changing, and behind the rise and fall lies human nature and the game between bulls and bears!
When I tested various trading strategies using historical data from all markets and all varieties, including stocks, commodity futures, cryptocurrencies, and forex, I finally understood concepts such as the law of large numbers, normal distribution, central limit theorem, statistics, and laws of volatility! Often, simply understanding the theory is not enough; practice is needed to fully grasp these concepts!
Essentially, a stop-loss is equivalent to 'liquidation', a certain loss! Many high-return strategies do not have stop-losses!
The cost of stop-loss includes the closing transaction fees + slippage. The concept of stop-loss is merely a scam designed by financial institutions; if you do not stop-loss, how can quantitative companies take the opposite side to make money? If you do not stop-loss, how do exchanges earn transaction fees? Stop-loss is just a means of capital management! It has no inherent relationship with profitability! Whether a strategy can be profitable in the long run depends on whether its investment model's expected value is positive, whether it can withstand big data validation, and whether it aligns with market laws! Is there a probabilistic advantage?
Of course, stop-losses also have their benefits; if you frequently stop-loss, chasing highs and cutting losses, you will ultimately just be nicking yourself with small cuts!
If you are trading altcoins, or if you frequently go all in with 3x, 5x, or 10x leverage, you must also have stop-losses! Even if you always use 2x leverage to go all in, you will eventually face liquidation!
When participating in cryptocurrency investments, one should fully understand the associated risks, maintain calmness and rationality, and respond to market changes with a prudent strategy!