It's been a while since the last update, and many fellow coin enthusiasts have privately messaged me asking how to trade small funds to grow them. I believe many here started with small amounts; nobody begins by investing large sums or all their assets to trade coins.
Next, I want to talk about this knowledge point - rolling positions.
How to roll positions:
In the crypto space, you need to find a way to earn 1 million in capital, and the only way to grow from tens of thousands to 1 million is through one path.
That's rolling positions.
Once you have $1 million in capital, you'll find that your entire life seems different. Even if you don't use leverage, just holding the spot will yield significant profits.
At 20%, you would have $200,000, which is already the income ceiling for most people in a year.
Moreover, when you can grow from tens of thousands to 100,000, you will grasp some thoughts and logic for making big money. By then, your mindset will calm down a lot, and it will just be about copying and pasting.
Don't always think about tens of millions or hundreds of millions. Start from your actual situation. Bragging only makes you feel good. Trading requires the ability to recognize the size of opportunities; you can't always trade with small positions or always with large positions. Usually, play with small positions, and when a big opportunity comes, bring out the big guns.
For example, rolling positions can only be operated when there is a significant opportunity. You can't keep rolling; missing out is not a big deal because you only need to roll successfully three or four times in your life to go from zero to tens of millions. Tens of millions are enough for an ordinary person to upgrade.
You're in the ranks of wealthy individuals.
A few points to pay attention to when rolling positions:
1. Sufficient patience; the profits from rolling positions are enormous. As long as you can successfully roll a few times, you can earn at least tens of millions, even hundreds of millions.
When you can’t roll easily, you need to find high certainty opportunities.
2. High certainty opportunities refer to sideways fluctuations after a sharp drop, followed by an upward breakout. At this point, the probability of following the trend is quite high.
You need to find the point of trend reversal and get in early.
3. Only roll long;
▼ Rolling Position Risks
Let's talk about the rolling position strategy. Many people think this is risky, but I can tell you that the risk is very low, much lower than the logic of opening positions in futures.
If you only have 50,000, how to start with that? First, that 50,000 should be your profit. If you are still losing, then stop looking.
If you open a position in Bitcoin at $10,000 with a leverage of 10 times, using a cross-margin mode and opening only 10% of your position, you are essentially using 1x leverage with a 2% stop loss. If you hit your stop loss, you would only lose 2%, which is $1,000. How do those who get liquidated actually get liquidated? Even if you did get liquidated, it's just a loss of $5,000, right? How could you lose everything?
If you are right, and Bitcoin rises to $11,000, continue to open 10% of your total capital, with a 2% stop loss. If you hit the stop loss, you still make 8%. What is the risk? Didn't they say the risk is huge? And so on...
If Bitcoin rises to $15,000 and you increase your position smoothly during this 50% rise, you should be able to earn around $200,000. Catching two such trends would mean around $1 million.
There is no compound interest. The 100 times comes from two 10 times, three 5 times, and four 3 times, not from compounding 10% or 20% every day or month; that's nonsense.
This content not only includes operational logic but also encompasses the core principles of trading, including position management. As long as you understand position management, you won't lose everything.
This is just an example; the general idea is like this. The specific details still need to be pondered by yourself.
The concept of rolling positions itself does not carry risk; in fact, it is one of the most correct strategies for trading futures. The risk comes from leverage. You can roll with 10x leverage or even with 1x; generally, I use two to three times leverage. Capturing two trends yields the same high returns. If worse comes to worst, you can use 0.x leverage. What does that have to do with rolling positions? This is clearly a matter of your own leverage choices; I have never suggested using high leverage to trade.
Moreover, I always emphasize that in the crypto space, you should only invest one-fifth of your money, while only one-tenth of your cash should be used for futures. At this point, the capital for futures only accounts for 2% of your total capital, and you should only use 2-3 times leverage while only trading Bitcoin, which effectively reduces the risk to a very low level.
Would you feel heartbroken if you lost $20,000 from $100,000?
Always leveraging is meaningless. There's always someone saying that rolling positions are risky, and that making money is just luck. I'm not saying this to convince you; convincing others is pointless. I just hope that those with similar trading philosophies can play together.
Currently, there is no filtering mechanism, and there are always unpleasant voices that disturb those who want to see.
▼ Capital Management
Trading is not necessarily full of risks; risks can be mitigated with capital management. For example, I have a futures account with $200,000, and my spot account ranges from $300,000 to $1,000,000+. When opportunities are great, I invest more; when there are no opportunities, I invest less.
With good luck, you can earn over 10 million RMB in a year, which is quite sufficient. Even in the worst-case scenario of a futures account liquidation, it doesn't matter; the spot profits can offset the losses from the futures liquidation. After offsetting, you can dive back in. Can you really not earn a penny in the spot market in a year? I haven't reached that level of incompetence yet.
You may not make money, but you cannot afford to lose money. I've been liquidated a long time ago, but I often save 25% to 20% of my profits separately. Even if I get liquidated, I will still retain some profits.
As an ordinary person, my personal advice is to use one-tenth of your spot position to trade futures. For example, if you have 300,000, use 30,000 to trade. When you make a profit, put it back into the spot. After going through ten or eight liquidations, you will surely get a sense of the market. If you haven't figured it out yet, then don't play; this industry may not be suitable for you.
▼ How to Grow Small Capital
Many people have misconceptions about trading. For example, they think that small capital should do short-term trades to grow, which is completely misguided. This kind of thinking is merely trying to exchange time for space, hoping to get rich overnight. Small capital should focus on medium to long-term investments to grow.
Is one piece of paper thin enough? If a piece of paper is folded 27 times, it becomes 13 kilometers thick. If it is folded 10 more times, reaching a total of 37 folds, it would be thicker than the Earth. If you could fold it 105 times, the entire universe wouldn't be able to contain it.
If you have $30,000 in capital, you should think about how to triple it in one wave, and then triple it again in the next wave... This way, you'll have four to five hundred thousand. Instead of thinking about 10% today and 20% tomorrow... doing so will eventually lead to your downfall.
Always remember, the smaller the capital, the more you should focus on long-term strategies. Relying on doubling through compound interest to grow is not advisable; do not engage in short-term trades for small profits. That's all for today's article; if you read it, give me a follow.
Playing in the crypto space is essentially a battle between retail investors and whales. If you don't have solid professional skills, you can only be at the mercy of others! If you want to strategize together and harvest with fellow investors, you're welcome to join and discuss with like-minded crypto enthusiasts~
