A few days ago, someone asked: 'How to make money in the crypto space with 5,000 yuan?'
I said, 'Let's do an Ethereum contract grid, setting the range between 1900-2800 U.' I said this because I am indeed doing it, based on the current market conditions, I think the possibility of Ethereum directly dropping below the liquidation line is very low (but not impossible). For 5,000 yuan, I think this is a somewhat risky but relatively suitable suggestion. As a result, I was criticized: some told me to 'be a person,' others said 'the risk is huge,' some called me 'bad,' and others said 'a small position doesn't mean anything.'
I dare say that those who say these words must be losers, definitely not people with much money. Why? I previously wrote an article: To make money, you must separate emotions. In fact, whether making money or doing anything, to have good results, you must detach from emotions. But people are influenced by emotions in every aspect. Why can dollar-cost averaging make money? The essence is to eliminate the market's emotional influence. These people are giant babies dominated by emotions; they don't provide any specific strategies, just enjoy arguing with others. There's no reason, just their own dissatisfaction, having too much time, and not feeling significant, so they need to vent their emotions.
I am not writing this today to counter emotions but to state some facts. You see some people making a lot of money, right? They have large positions and earn a lot in absolute returns. But if you look at the return rate, it's actually quite low: earning 5% on 2 million is 100,000, which is a lot, but in the crypto space, that return rate is very small. You need to compare other return rates horizontally because you will definitely experience drawdowns. You earn 5%, but a drawdown could be 10%. If you only look at 100,000, you would definitely think it's impressive. It's the large principal, not skill. Making money is just a result of market luck.
I have been doing this grid for 9 days, with a return rate of 11.27%. Linear extrapolation suggests a monthly return of 30%. Isn't that a lot? Some say, 'the principal is too small,' but you have to look at the return rate. The market doesn't mind your capital amount; whether you have 1 million or 10 million to do grid trading, you can still achieve a 30% return rate. But first of all, you don't have that money and won't do it. So, what I'm talking about is a plan for 5,000 yuan. As long as it doesn't drop unilaterally, both fluctuating and rising markets can make money; we can say 70% of market conditions are profitable. A 30% crash could lead to liquidation and total loss, but still, it's only 5,000 yuan. Meanwhile, you are also losing in spot trading, it's not just this loss. Spot trading can recover, but 5,000 yuan doesn't have much significance in your life. If you really lose it, so what? You need to look at the problem comprehensively.
Now that the Binance wallet Alpha points activity is ongoing, are the earnings significant? Actually not much; it might be just 3,000-5,000 yuan in a month, but the investment cost is 900 yuan for a month. This 900 yuan is a sunk cost, once invested, it's gone. But you have to look at the absolute return rate, and many people look down on it. I don't understand why they look down on it. I have set up 7 accounts myself; one account made 2,000, which is a total return of 14,000. If I use this 14,000 to buy assets, it becomes an additional 14,000. If I use the 14,000 for a Virtual IPO, it turns into 24,000 in 30 days. If I can play Virtual for 3 months, 24,000 would become 96,000. Even if I lose, it's just a loss of 14,000; how does it affect the principal?
I made 130 U from grid trading, which allows me to buy Virtual points for another 2 days. This 130 U will become 260 U in a month. Some people simply complain out of dissatisfaction, just to argue for the sake of arguing. If you can't accept any risk and can't let go of a bit of security, then why come to the financial market? Working honestly is the most stable.
Today, let's specifically talk about which carries more risk: contracts or spot trading. Many people haven't thought deeply about this and would definitely say contracts carry more risk. In fact, contracts are just harder to profit from, not necessarily riskier. For most people, contracts don't carry significant risks. This is what I would say to those who can think logically; gamblers are excluded.
In reality, who loses their family fortune more often: gamblers or entrepreneurs? Definitely entrepreneurs. Few people would gamble their family fortune, but many would go all-in on business. In reality, are there more people making money from work and entrepreneurship, or from gambling? Certainly from work and entrepreneurship. Profits are linked to risk; few make money from gambling, so the overall risk behind it is low; while entrepreneurship and work have high profits, the risks are also high. Many people have never thought about this overall risk issue. Risks occur because one is unaware of their existence, only listening to others, and then making emotional judgments themselves.
The same goes for contracts. Are there more people losing money in contracts or in spot trading? Definitely in contracts. But is the amount lost in contracts larger or in spot trading? It's spot trading. Because normal people don't specialize in speculation; they play with a small amount in contracts, whereas in spot trading, they buy and wait for a bull market, waiting indefinitely. Altcoins keep falling, and when the bull market comes, they buy at the peak, and if it doesn't come, they keep averaging down, which makes the loss process numb. So when spot trading incurs losses, they are usually significant. In a contract, if you get liquidated once, you might curse: 'shit, I'm not doing this again,' and you might understand it after just one time. Losing all your money in contracts doesn't hurt that much; the loss in spot trading is a numb process, and you might lose more. I see people around me losing millions or tens of millions in spot trading, while those in contracts only lose tens of thousands.
Many people have tried both contracts and spot trading; those who lose tens of thousands in contracts feel it's too difficult and stop; spot trading tells you 'if you buy right, you'll profit in a bull market,' so they keep buying, but when the bull market comes, it just doesn't rise. You might keep averaging down until you run out of money, and then you lose everything. Therefore, we need to look at issues dialectically; risks are always present. To make money, you must accept the risk, not avoid or attack it. Risk is a good thing; it increases your anti-fragility. You need to gain returns from risk for your assets to grow. As long as you have a little depth of thought and don't just follow the crowd, the results will be completely different.
Someone commented yesterday saying, 'I can't make money now.' How can that be? Aren't we always making money? Aren't others always making money too? Why must you come in and say, 'I want to make 10 times or 100 times'? That's delusional, not making money. For instance, participating in Virtual IPOs or wallet bonus activities—aren't they all money? Many people say, 'I can't do it.' It's simple: pay to learn from others.
Many people are extremely averse to paying, thinking 'they will be scammed.' But how can one grow without being scammed? What happens if you get scammed a little? Why do you get to make money without taking a little risk? Seeing others wanting money makes you uncomfortable, saying 'the world is not the same anymore,' that's just being swept up by emotions. Then don't make money first; clear your emotions, and wait until you are stable to think. Doesn't making money also require upfront costs, buying equipment, and selling goods? If you understand this logic, you won't be swayed by emotions.
The root cause is that many people are driven by emotions rather than by results and returns.
Continuing to fight alone and relying on luck to make money will ultimately lead to losing due to inability, being overwhelmed in the market tide!
The market never lacks opportunities; the problem is whether you can seize them. You need to follow the right people to survive in the market long-term and earn more!
Wanting to double the account, wanting to enjoy big profits, wanting to successfully return to break even.
Follow Sister Xin closely to position yourself ahead of the bull market's main wave!
