Many people wonder, since I am optimistic about a coin, why not buy with my entire position? However, as the saying goes, investing carries risks.

Investing is not gambling.

1. The Importance of Position Control

Buying a coin with your entire position is very risky. If that coin loses 10%, you must earn 20% to break even. When losses exceed 50%, you even need to double your investment to recover the principal. These figures remind us that when choosing positions, we should follow the principle of 'not putting all eggs in one basket.' Even if you are very optimistic about a coin, reasonable position control can effectively diversify risk.

2. Strategies for Batch Trading

By buying and selling in batches, ordinary retail investors can better manage risks. For example, dividing the position into three layers and buying 30% each time. This way, if market fluctuations lead to a 10% drawdown, the overall loss only accounts for 3%. When losses are limited, one can also stop losses in time to ensure that they will not suffer heavy losses from a single erroneous trade. At the same time, selling in batches can help lock in some profits and realize gains.

3. Potential Returns from Compounding

In the cryptocurrency market, the compounding effect is key to obtaining long-term returns. Suppose each time you purchase 30% of your position and it rises by 5%. Overall, you gain a profit of 1.5%. Although this profit seems low, if sustained steadily, a weekly return of 1.5% can reach 6% in a month, resulting in an annual return of 72%. This way, you can not only experience capital appreciation but also reduce risks, making returns sustainable.

4. Adjusting Investment Mindset

Many newcomers often make impulsive decisions due to greed and impatience. The desire for quick doubling usually results in frequent trading, which may backfire. Investment behaviors that are overly eager to succeed often increase the probability of making mistakes. In the market, maintaining calm, patience, and rationality is the key to success. In contrast, steady operations and long-term thinking are more likely to yield sustainable profits.

5. The Impact of Psychological Factors

There is an old saying: 'Wealth does not enter through urgent doors!' This ancient adage is equally applicable in the crypto world. Newcomers who are eager to profit immediately often get lost in the uncertainty of the market, leading to losses. During a bull market, rapid trading may be taken for granted, but in a bear market, one may face total loss. Therefore, establishing a good trading mentality, setting reasonable expectations, and formulating practical trading strategies are crucial aspects that everyone must not overlook in their operations. PS: Everything takes time!

Conclusion

The crypto space is not a place where more work equals more gain. Sometimes, the more you do, the more mistakes you make.

There is a joke that goes like this:

Bull markets work for brokers, bear markets cost you hard-earned money. That's what it means!

The following are all in my BAG