Retail investors commonly suffer from the problem of feeling their position is too small when they are making profits, and fearing their position is too large when they are incurring losses! In trading, a common issue is that when the market rises, investors feel their position is too small; conversely, when the market falls, they feel their position is too large. This situation indicates a lack of proper position management.
In reality, regardless of whether the market is rising or falling, if one has not fully established their position, they will regret their earlier hesitance. Conversely, if they have a position, they will regret not having liquidated it. This mindset is a norm among cryptocurrency traders. Therefore, we often advise against making hasty adjustments to one's position. When adjusting positions, one must carefully consider how much risk they can bear. If one is sensitive to unrealized gains or losses, it is sufficient to maintain a portion of the base position.
Here are some suggestions for position management:
1. Do not invest all your funds into the market at once, unless you have decided not to adjust your position anymore.
2. Even if you are very optimistic about a particular cryptocurrency, you should build your position in batches. One should maintain a respectful attitude towards the market, avoiding excessive confidence and impulsiveness.
3. When adding to your position, the price difference should be greater than 20%. Otherwise, there is no need to add to the position, especially in cases of insufficient funds.
In summary, position management is extremely important. There is no need for frequent operations or complex technical skills; as long as one can manage their positions well, they can outperform most cryptocurrency enthusiasts.
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