Many bloggers claim that the 5x or 10x leverage they use is conservative, but in fact, this perception is misguided. The calculation of leverage is not only about the platform's safety share; more importantly, individual investors should assess risks based on stop-loss or sufficient principal. In the crypto market, due to extremely high volatility, it is advisable to open positions gradually, investing about 10%-20% of the principal each time, with a total position limit not exceeding 24 times the principal, and the overall stop-loss risk at any one time should be controlled within 20% of the principal (or according to personal psychological tolerance, but must be less than 20%). Sometimes, for safety's sake, it is better to remain in a cash position.
Perhaps some may question, if that's the case, what is the significance of doing contracts? In fact, contract trading is fundamentally different from simply investing in coins. The essence of contracts lies in trading risks or utilizing risk management and expectations to profit. In contract trading, you may not believe in technology, manipulators, K-lines, etc., but you must deeply understand risks and learn how to control, calculate, and avoid them. Because, in the contract market, the money you earn often comes from the losses and liquidations of others.
When you really look at the market from a risk perspective, you will find it fundamentally different from the perspective of an average person. Those buying coins can hold their positions and wait for a rise, but in contract trading, holding positions while waiting can quickly lead to trouble. Therefore, the operational methods based on risk management are fundamentally different from those based on dreams. In the trading market, dreams often come with a price, while risk managers focus on profiting from those costs.
To become a successful contract trader, you must learn to wait, test, retreat, try again, and then wait. This is the norm for successful speculators. At the same time, you need a complete set of stop-loss theories to guide your operations. The value of this theory may be equivalent to half of your invested contract funds. Only through serious study and training can you truly establish yourself in the contract market.
Just like flying a plane, if you can't fly but force yourself to do so, the result is often catastrophic. Similarly, if you can't speculate but force yourself to do so, you will inevitably face the risk of liquidation. Therefore, risk management and stop-loss management are like the most basic skills of flying a plane; they ensure that you at least won't experience a 'total loss' in the market.
Finally, I want to remind everyone that while pursuing high returns, it is essential to remain calm and rational. In the cryptocurrency space, whether investing or trading, it requires professional knowledge and skills. At the same time, you must always pay attention to market dynamics and risk changes to adjust your strategy in a timely manner. Only in this way can you move steadily in the crypto space and achieve your wealth appreciation goals.
Recently, I plan to ambush a potential coin that is ready to explode, doubling my investment should be quite simple, and I am also looking for some potential coins to hold until the end of the year, with an expected space of more than 10 times being no problem; keep up to eat meat below 999.
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