Don't understand position management? You will always be the 'ATM' in the market!
In the crypto world, this emotion amplifier plays out the drama of 'greed, anger, and ignorance' every day. I've seen too many tragedies like this:
- Newbies follow the trend and go all in right away
- Get overly emotional and go all in
- After winning several trades, you get carried away and lose everything in the end
This is not investment; this is suicidal gambling!
[Blood and Tears Lesson] The worst case I have ever seen:
When LUNA crashed in 2021, a friend went all in with 50,000U and lost everything in 30 minutes. Another friend was also bullish but used only 10% of his capital, which allowed him to preserve his capital, and he earned back the loss in three months with the remaining funds.
This is the world of difference in position management!
The 'Position Survival Rule' that real winners are using:
1️⃣ Capital Division Principle
- Single trade should not exceed 5% of total capital
- Keep total position within 20% during the same period
- Always keep more than 50% of your capital as backup
2️⃣ Dynamic Adjustment Strategy
- Initial position 10%, increase in batches after confirming the trend
- Consider increasing position only after a profit of over 20%
- Reduce position by half immediately on a 10% drawdown
3️⃣ Risk Control Iron Rule
- Set the following before entering a trade:
√ Stop-loss level (force exit at a loss of 5%)
√ First take profit level (reduce position by half at 20% profit)
√ Second take profit level (close all positions at 50% profit)
[Practical Case] My record of rolling my 2000U to 40,000U:
1. Initial capital divided into 20 parts, each part 100U
2. Use only 1 portion per trade, increase position only after a profit of over 30%
3. Strict stop-loss, single loss should not exceed 50U
4. Monthly compound growth stabilized at 15-20%
Remember: The market never lacks opportunities; what it lacks is the capital to survive until tomorrow! You have two choices now:
A. Continue gambling-style trading, waiting to be harvested
B. Learn to protect yourself with position management and become part of the 10% winners
To change, now is the best time! Starting from the next trade, cut your position in half to give yourself a chance to survive.
