I haven't updated in a long time. Many crypto friends message me asking how small funds can trade to grow larger. Many of them probably started with small funds; no one starts with a large amount of money or their entire assets to trade cryptocurrencies.
The knowledge point I want to talk about next is - rolling positions.
How to roll positions:
In the crypto space, you need to find a way to earn 1,000,000 in capital first. The only way to grow from tens of thousands to 1,000,000 is through one path.
That is rolling positions.
Once you have 1,000,000 in capital, you will find that your whole life seems different. Even if you don’t use leverage, your spot trading will rise.
20% yield would be 200,000; 200,000 is already the income ceiling for most people in a year.
And when you can grow from tens of thousands to 1,000,000, you will grasp some ideas and logic for making big money. At this time, your mindset will also calm down a lot, and from then on, it’s just about copying and pasting.
Don’t always think in terms of tens of millions or hundreds of millions. Start from your actual situation. Always bragging only makes you feel comfortable. Trading requires the ability to recognize the size of opportunities; you cannot always trade lightly, nor can you always trade heavily. Usually, just trade small amounts, and when a big opportunity arises, that’s when you bring out the big guns.
For example, rolling positions can only be operated when a big opportunity comes; you cannot always roll. Missing out is fine 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.
The ranks of wealthy people.
Key points to pay attention to when rolling positions:
1. Sufficient patience; the profits from rolling positions are enormous. As long as you can roll successfully a few times, you can earn at least tens of millions or even hundreds of millions.
You cannot easily roll; you must find high-certainty opportunities.
2. High-certainty opportunities refer to the situation where there is a sharp drop followed by sideways fluctuations, and then a breakout upwards. At this time, the probability of following the trend is very high.
Find the point of trend reversal and get on board from the start.
3. Only roll long positions;
▼ Risks of rolling positions
Let’s talk about rolling position strategies. Many people think this is risky, but I can tell you that the risk is very low, far lower than the logic of opening positions in futures.
If you only have 50,000, how do you start with 50,000? First, this 50,000 should be your profit. If you are still losing, then don’t look.
If you open a position in Bitcoin at 10,000 with a leverage of 10 times, using a gradual position mode, only opening 10% of your position, that means only using 5,000 as margin. This is actually equivalent to 1x leverage, with a stop loss of 2%. If you hit the stop loss, you would only lose 2%, which is 1,000. How do those who get liquidated get liquidated? Even if you get liquidated, isn’t it just a loss of 5,000? How could you lose everything?
If you are correct and Bitcoin rises to 11,000, you continue to open 10% of your total funds, also setting a 2% stop loss. If you hit the stop loss, you still earn 8%. Where’s the risk? Isn’t the risk very high? And so on...
If Bitcoin rises to 15,000 and you successfully add positions, in this 50% market movement, you should be able to earn about 200,000. Seizing two such market movements could mean around 1,000,000.
Compound interest does not exist. 100 times is made through two rounds of 10 times, three rounds of 5 times, and four rounds of 3 times, not through daily or monthly compound interest of 10% or 20%; that’s nonsense.
This content not only has operational logic but also contains the core internal methods of trading, position management. As long as you understand position management, you cannot lose everything.
This is just an example, the general idea is like this, the specific details still need to be pondered more by yourself.
The concept of rolling positions itself does not have risks. Not only does it not carry risks but it is also one of the most correct thoughts in futures trading. The risk lies in leverage. You can roll with 10 times leverage, and you can also do it with 1 time. Generally, I use two to three times leverage. Grabbing two times isn’t the same as having dozens of times in returns? If not, you can use 0. X times. What does this have to do with rolling positions? This is clearly your own choice regarding leverage. I have never said to use high leverage for trading.
Moreover, I have always emphasized that in the crypto space, you should only invest one-fifth of your money and only one-tenth of your spot trading money into futures. At this time, the futures funds account for only 2% of your total funds, and only use two to three times leverage for futures, focusing only on Bitcoin. You can say the risks are minimized to an extremely low level.
Would you feel pain if 20,000 of your 1,000,000 were lost?
Always leveraging is meaningless. There are always people saying that rolling positions are risky, and that making money is just good luck. These statements are not meant to convince you; convincing others is pointless. I just hope that people with the same trading philosophy can play together.
There is currently no screening mechanism; there are always harsh voices that interfere with the recognition of those who want to see.
▼ Capital Management
Trading is not filled with risks; risks can be mitigated through capital management. For example, I have a futures account with 200,000, and a spot account ranging from 300,000 to over 1,000,000. When opportunities are abundant, 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 more than enough. In the worst-case scenario, if my futures account gets liquidated, it doesn’t matter; the profits from spot trading can cover the losses from the futures liquidation. After compensating, I can go back in; is it impossible to earn even a penny from spot trading in a year? I’m not that bad.
You can not make money, but you cannot lose money. I haven't been liquidated for a long time, and I often save a quarter or a fifth of what I earn in futures separately. Even if I have exposure, I will still retain part of the profits.
As an ordinary person, my personal advice is to use one-tenth of your spot trading capital to trade futures. For example, if you have 300,000, use 30,000 for trading. When you have exposure, put the profits from spot trading into it. After experiencing this eight to ten times, you will manage to grasp some insights. If you still haven't figured it out, then don't trade; it's not suitable for you.
▼ How small funds can grow larger
Many people have many misconceptions about trading, for example, small funds should trade short-term to grow their capital. This is a complete misconception. This way of thinking is entirely trying to exchange time for space, attempting to get rich overnight. Small funds should do medium to long-term trading to grow.
Is a piece of paper thin enough? A piece of paper folded 27 times is 13 kilometers thick, and if folded 10 more times to 37 times, it would be thicker than the Earth. If folded 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... then you will have four to five hundred thousand. Instead of thinking about making 10% today and 20% tomorrow... this will eventually lead to your downfall.
Always remember, the smaller the capital, the more you should focus on long-term positions, relying on compounding to grow larger. Do not engage in short-term trades for small profits. This article ends here. If you’ve read it, please give me some attention, and I will update more knowledge content in the future. This article is just personal insights, and anything involving money matters is fraudulent. All crypto friends should protect their wallets. Meeting adjourned.
