Recently, I have seen many discussions about the frequent accidents in the crypto space. Regarding contracts, I would like to share my views; the crypto space is essentially a form of investment, naturally, there will be profits and losses. Contract trading is high risk, but the potential returns are also high; how to manage it?
1. Risk control plan, it is recommended to trade with a light position, lower risk, and basically you can earn a little over time.
Maintain a constant position for a month. Change it once a month to cultivate the habit; this way, trading will not be stressful, and you can maintain a calm mindset, making it easier to earn money. This is what real investing looks like; otherwise, it is still speculation.
2. No matter what position, make sure to set a stop-loss! Even if you have already lost several times, you must set a stop-loss!!!
3. For example, with a capital of 3000U, open 8% of funds each time, choose 100x leverage, and open 20 contracts each time.
Within two weeks or longer, maintain the same number of contracts. After two weeks, if the capital reaches 5000U, we will adjust the number of contracts to 30 and continue trading for another two weeks. By doing this, the margin used each time will be the same, and as long as our win rate is greater than 50%, with a small stop-loss and large take profit, we will definitely make a profit.
If your take profit is from a position of 100 contracts and your stop-loss is from 300 contracts, then overall you are at a loss.
And I always use the same number of contracts, with the same take profit and stop-loss; as long as the win rate is above 50%, I will be making a profit overall.
As long as the stop-loss is small and the take profit is large. With the same position and number of contracts, after trading for a period of time, you will definitely make a profit.
4. Regarding how much capital to put into a trade, I personally suggest building positions in batches, with the final position accounting for 3%-5%.
At most, do not exceed 10%!!!
Remember, do not hold positions!!!
Holding positions will lead to certain losses!!!
Keep this in mind!!!
Generally, when profits reach 50%-80% or double, you can close 50% of your position and continue to hold the rest, then set the stop-loss to the opening price!
After making a profit, reduce your position, and then set the stop-loss to the opening price to prevent profit drawdown. Don't be greedy! Don't be greedy! This is the best secret in trading!
I hope everyone does not operate frequently, when trading, wait for a stable stop-loss, even if you hit a stop-loss, you won’t lose much!
When profits double, it’s time to cash out!
When trading contracts, whether it's a long or short position, a stop-loss must be set. Set the stop-loss based on your personal risk tolerance, and even if the stop-loss is wrong, it must be enforced strictly!
Do not set the stop-loss points as whole numbers; add three to five more points to prevent being stopped out.
Finally, I want to share a phrase with everyone. Be a trader, an investor, develop the habit, control your mindset, and slowly accumulate wealth in this trading market, rather than becoming a gambler hoping to get rich overnight. When you pin all your hopes on one thing, you have already lost.