Cryptocurrency Averaging Down Techniques and Investment Truths: Avoid Blindness, Minimize Losses

Averaging Down Cost Calculation: Don't Be Misled by "Average Price"

Assuming you buy 10,000 worth of coins for 100 yuan, and then buy another 10,000 when it drops to 50 yuan, the cost is not 75 yuan, but 67 yuan. Because the second purchase is larger, it lowers the average price. But don't think that "lower cost" means safety; after averaging down, strict stop-loss is still necessary, or you will get trapped deeper.

1% Daily? The Reality of Compound Interest Myths

With a 100,000 principal, earning 1% daily for 250 days can reach 1.32 million. But in reality, stable profits are extremely difficult. Most people earn 5% today and lose 10% tomorrow, ultimately resulting in wasted efforts. Discipline is more crucial than strategy.

Can You Lose Money with a 60% Win Rate?

In 100 trades, if you win 60 times at 10% profit (total profit of 60%), and lose 40 times at 10% loss (total loss of 40%), the net gain is 20%. However, if you take small profits and hold onto large losses, a high win rate is futile. The win-loss ratio determines success or failure.

From 10,000 to 100 Million? Don't Dream

Theoretically, winning 10% each time and winning 97 times in a row could reach 100 million. However, in reality, after consecutive wins, one's mindset swells, and a single large loss could wipe it all out. Investing is a test of human nature, not a mathematical game.

Investment Survival Rules

1. Averaging Down Principle: Lowering costs is a mathematical game, set clear stop-loss points, or else it becomes gambling.

2. Profit Reality: Give up the fantasy of getting rich quickly; pursue "small profits and small losses, occasionally large profits," and accumulate over the long term.

3. Profit and Loss Management: Strict stop-loss, let profits run, and ensure a reasonable win-loss ratio.

Summary: Successful investing relies on discipline and mindset. Recognize the truth of the market, discard illusions, and steady progress is the way to go far.

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