It seems very basic, but the vast majority of people cannot do it. If you can accomplish all three points, you have basically left the ranks of retail investors:
🦄 Three questions to ask before investing, a summary of years of pitfall experiences:
1) Whose money are you making, and why can you make this money?
2) What is the risk control strategy corresponding to this strategy, and what is the proportion of risk exposure? In the most extreme case, what would the asset price be, and can you bear it?
3) What is your logic for making money, and what proportion does this factor account for among all price influencing factors? How do you control other factors?
🎁 Let me explain separately:
1) Profit comes from cognitive disparity or information asymmetry. If you can't figure out whose money you are making, then it's gambling. Gambling will lead to being influenced by retail emotions and being harvested by those with information asymmetry. Moreover, when we have a logic, we also need to confirm why others do not have this logic and where our underlying relative advantages lie.
2) One must admit that their cognitive ability is limited and cannot cover all aspects. Therefore, we need to prepare strategies for different exposure ratios in advance and strictly enforce them before investing. The most extreme situation is to predict prices in your most pessimistic scenarios or the worst historical situations; it must be sufficiently pessimistic. The best situation is to listen to what others say on the short side. Only by not leaving the table can you have a chance to make money.
3) What is your logic for making money? Does this factor explain all prices? For example, I short meme coins because I believe memes have a head effect; small memes will ultimately perish. However, meme prices are also influenced by the overall market, the rise of communities, and increased risk appetite, etc. Therefore, your logic of ultimate demise may only account for 10% in the short term among all factors, although it may be a dominant factor in the long run. This means that you have 90% of volatility that is not predicted or controlled by you. You can choose to hedge them, such as buying the overall meme index, or you can maintain sufficient margin and prepare to fight long-term.
🚂 Correct expression example:
1) My strategy is to go long on RED because I believe the valuation of this coin is too low. The logic behind the low valuation is that as a **technical oracle, it has the potential to challenge others, and its technological advantage is ***(a clearly express investment logic). I can recognize what others cannot because I am a web3 practitioner; I have read its white paper in full and have valuation technology. Moreover, not many people meet these conditions (b clearly express relative cognitive advantage or information advantage). Due to its poor airdrop operation, the market's reputation has collapsed, resulting in a price that is too low (c aware of why others have valuation errors).
2) This strategy is a fundamental strategy, with a market capitalization above 1 billion, and listed on exchanges. According to my risk control ratio, I can invest 5%. The worst-case scenario is that the project team runs away, resulting in a total loss, or a significant decrease in the oracle market share, lacking sufficient market presence. I will continuously track the market share of this contract, and I can accept the risk of total loss. (d risk control limit).
3) The price of RED is also affected by market speculation sentiment, operator manipulation, overall market trends, etc.:
a Regarding speculation sentiment: the market heat has passed. It is currently entering a continuous decline period.
b Regarding operators: Looking at token economics, the overall short-term unlock pressure is not great, the operator's control is moderately high, and some tokens have already been released in the early stage.
c There is a significant possibility of a sharp decline in the overall market. I have taken measures to hold BTC airdrops to cover 50% of the exposure, making β controllable. Currently, this weight is showing a relatively independent trend, detached from the overall market.
Overall assessment indicates that the fundamentals account for 30% of the short-term factors, and over 60% for long-term factors (purely based on feeling, just an example).
In summary, my long-term price estimate is between 1.0-1.8, with 0.6 being relatively undervalued. If it falls below 0.5, I will increase my position, holding period of 1 year, no stop-loss line, liquidating in batches, selling 30% at 0.7, 30% at 0.9, and 30% at 1.5.
What has been presented above is just an example, the actual situation is much more complex, and the data is simulated, so please do not take it seriously. It does not constitute investment advice.
#秘籍 #经验总结 #RED #BTC #策略
