Reviewing 4 little-known trading tips in the crypto world
1. If you bought 10,000 U at 10 U for a certain coin, and then bought another 10,000 U when it dropped to 5 U, your average cost would be 6.67 U, not the imagined 7.5 U.
2. If you have 100,000 and make 1% profit daily, and exit, calculating based on 250 trading days a year, your assets could reach 1.3232 million after one year, and you could make 10 million in two years.
3. If the probability of successful investment is 60%, and you invest 100 times in a row, setting both the take-profit and stop-loss at 10%, your final return would be 300%.
4. If you enter the market with 10,000 U, making a 10% profit each time, you could reach 1 million U on the 49th day, 10 million U on the 73rd day, and over 100 million U on the 97th day.
Achieving the above in practice is something that not a single person out of ten thousand can do, primarily because people cannot control their greed. I won't discuss spot trading today, but rather contracts.
In contract trading, it is essential to have your own position management and capital management, and then open positions based on your risk tolerance. So, what is position management, and what is capital management?
Position management and capital management: If you have 10,000 U in funds, many new players or seasoned speculators use 20%-30% of their principal as a base position.
At that time, whether in profit or loss, it will greatly affect your mindset, thereby influencing the final outcome.
My personal habit is to use 2%-5% of the principal as a base position, with a leverage of 20 times. Those who frequently use 100 times or even 125 times leverage are essentially courting disaster.
Whether in futures, stocks, or contracts in the crypto space, spot trading is a game of human nature, and leverage amplifies one's greed. Everyone has their own greed, and if you amplify that greed infinitely, you will ultimately be consumed by it.
Therefore, trading must include proper capital management and position management, as that is the key to long-term profitability.
