I saw many respondents said that they opened a 5x or 10x leverage, which is already a very small leverage.
I'm really speechless. Actually, I want to tell you that you are all wrong.
Leverage is not calculated like this at all. The leverage ratio calculated by the platform has nothing to do with you. It is almost the share ratio that affects the safety of the platform. You should calculate the risk based on stop loss or full principal.
Crypto has such a high volatility. It is recommended to open positions evenly in batches, with 10~20% of the principal each time. The total upper limit of all positions is about 2 (short)~4 (long) times the principal. The overall stop loss risk at the same time should be within 20% of the principal (or the actual psychological tolerance must be less than 20%). The recommended time average risk is 10%, which means that there is a part of the time when the position is short. . . . Some people may ask, why do we still do contracts? . . . . . . Haha. . . I may offend the entire currency circle by saying this. Do you really want to make coins or money? Is there a more flexible speculative tool than a contract? Is the u-standard really useless? When the big bear market comes, is it safer to spend money on coins or u? When you spend money, do you spend money on coins or u?
Dear friends in the cryptocurrency circle, doing contracts (pure speculation) and investing in cryptocurrencies (similar to venture capital) are two completely different professions.
The essence of a contract is trading risk, or making money by using risk management and expectations.
When making a contract, this sentence must be made clear.
You may not believe in technology, do not believe in the market makers, do not believe in the K-line moving average, do not believe in $BTC , and think that they are all liars. Or you may believe in these things on the contrary. These conceptual issues will not prevent you from making money.
But there is only one thing you must understand, and that is [risk]. What is risk, how to control risk, how to calculate risk, how to operate risk, how to withdraw risk... How to survive...
-------You cannot make money beyond your cognitive scope. . . . . Originally, you invested in a coin, and the coin value doubled, so you earned 100%; then you traded a contract three times, and ended up making 300%. Do you know who earned this extra money and where it came from?
——For contract trading, what you earn is actually the money from risk management, which is the money given to you by others due to losses and liquidation. To get this money, first of all, you must not have a liquidation. . . .
In fact, looking at the market from the perspective of risk is completely different from looking at the market from the perspective of ordinary people. It is like looking at a mountain from the bottom of the mountain and looking at it from the top of the mountain. It is completely different. For example, people who buy coins can hold their positions and wait for the price to rise, and bear the loss. It requires patience. But if you do contracts, if you hold your positions and wait, and bear the loss, you will probably not survive the first three episodes.
Therefore, the operation based on risk management is completely different from the operation based on dreams. In the trading market, dreaming is paid, and the people who manage risk are trying to get the money.
So, whether you want to be a [dreamer] or a [risk controller], it depends on you. However, [dreamers] should not play with contracts, because contracts will shatter the beautiful dreams that you have made for years in a few days, and it is too fast to wake up.
Anyone who has made a lot of money will have a feeling during the process of making money: "That period was almost like picking up money", almost, but - when your chance comes, that is to say: when it is your turn to pick up money, you have to be alive and have the capital to pick up money.
Yes, it is not difficult to make money from contracts. After all, there are so many people who are losing money. They are racing on the cliff, and you just need to wait at the bottom of the cliff and pick up some parts to eat.
The difficulty lies in that it is bound to go against human nature. Basically, you have to do the opposite of ordinary people's ideas like "getting rich overnight". Whenever you are in a hurry to increase your position or open a position, you have to think about what it means to "go against human nature".
...If buying coins is fishing, then doing contracts is like getting on the boxing ring... So I said that there is a lot of time when I am short, which is normal. Wait, test, retreat, try again, and wait again... This is the normal state of successful speculators.
In fact, for a period of time, the strategies were almost simple and clear, and almost everyone knew them.
For example, as of February 14, 2022, many teams’ operating strategies are: shorting most currencies and choosing the right time to go long $BTC for hedging.
I won’t go into the reasons, just imagine yourself as a big shot in the cryptocurrency circle and then deduce. With such a strategy that is absolutely profitable, 80% of people cannot make money by operating the contract.
Such a simple strategy actually contains countless details. For example, the simplest operating principle, why not short directly based on BTC, why shorting is much more conservative than long, and the holding time is much shorter, how to deal with stop loss when shorting, how to short various technical currencies... Regarding the contract stop loss plan, it is necessary to have a theory, which is worth learning. The value of the stop loss theory is at least half of what you put into the contract. If you can't find it, you have to derive one yourself (this is what I did. I found someone, but he refused to teach me, so I deduced a set myself). A complete set of theories means a complete set of operations. If you strictly implement them, there will always be opportunities.
Trading is like this. On the surface, it is extremely simple to buy and sell (one minute on stage), but countless people have put in enough effort behind the scenes (ten years of hard work off stage). . . . . . . . In general, this is a profession. It does not mean that novices cannot do it, but you must study and train seriously before you can really play.
I often compare flying an airplane with speculating. The reason is that the two are similar. If you force yourself to fly an airplane without knowing how to fly, the plane will be destroyed and you will die. If you force yourself to speculate without knowing how to speculate, your position will inevitably go bankrupt.
Risk management and stop-loss management are equivalent to the most basic skills of flying a plane. With these, you can ensure that you will at least not die.
