Many people come to this market thinking they can get rich overnight, only focused on leveraging to the max. They hope to earn as soon as they enter, but most of your losses are not due to technical issues but poor position management.

Many tops and bottoms are not touched but are trapped. Many professional traders cannot precisely control the points and can only manage risk through scientific position management, thereby moving to the next stage!

What is position management? Simply explained:

1. Position = How much are you willing to bet on a single trade

2. Position Management = Ensures you won't fail even when you continuously make mistakes

3. Position size determines: speed of getting rich + speed of liquidation + emotional stability

Many people get the direction right but end up getting washed out? Clearly, they see the rise but close their positions during a minor pullback, even incurring losses! This shows that position management was not done well.

Three points explanation:

Correct direction but too small position = unable to profit

Wrong direction but too large position = a fatal mistake

Direction relies on probability, position relies on control

Add a strong memory point:

Trading is about making money from probabilities, not gambling with your life.

Check if you've made this fatal mistake:

1. Going all in right from the start

2. Continuously losing and increasing positions to try to turn the tables

3. When emotions come, position fluctuates greatly

4. Use stop-loss as position, gamble the losses to explosion

5. Risk has no plan, only looking at 'how much can be made'

How to manage positions specifically?

1. How many coins to open, for example, with 100x leverage on ETH, 1 ETH requires a margin of 30U, with 10x leverage it's 300U. However, if you only have 100U, opening 1 ETH at 100x leverage occupies one-third of your position, which poses a significant risk. But if you have 3000U, whether it's 10x or 100x leverage to open 1 ETH, the risk is not very high, and losses are acceptable. This is the appropriate position size for you. Opening 5 positions with 1000U or less, the larger the position, the more you need to manage it well. If you manage your position well, you can manage your emotions, ensuring that your trading analysis remains intact.

2. Strictly take profit and stop-loss; when the win rate remains between 30% and 50%, a risk-reward ratio of 1:1.5 and 1:2 is the best. If a trade does not meet your risk-reward ratio or does not conform to your trading system, then do not execute it. Since it does not conform to your trading system, you definitely should not go in heavy!

The relationship between position and stop-loss (core logic)

Position is the first line of defense

Stop-loss is the second line of defense

Both must be coordinated

Position determines whether you dare to execute a stop-loss.

Light position = calm

Heavy position = emotional, uncontrollable, and even = losing money (liquidation)

Novice beginners can engage in training that suits them:

1. Start with small funds and light positions for 20 trades

2. Set a fixed position each time

3. Strictly execute stop-loss

4. Record: profits and losses, emotions, position size

5. Observe which position is the most stable

Finally, here's a phrase for everyone:

If you can't manage your position well, even the best technique will only amplify losses.

If you manage your position well, even basic techniques can achieve compounding gains over time.

Wishing everyone to trade without dying forever! Low-multiple compounding! Always getting rich!#币安区块链周 #小白必知 #BTC