The essence of trading, in short, is to seek returns on the basis of taking risks. Every order is accompanied by the possibility of loss, which is similar to the potential risks faced when driving. So, how can we ensure that our trading account can grow healthily and steadily?

First, we must consider the maximum drawdown of the account. When setting this drawdown ratio, the key is to find a reasonable risk boundary. This boundary must consider both the efficiency of capital utilization and ensure that the risk taken is controllable.

So, what is the maximum drawdown ratio of the account to be controlled within a reasonable range? We can intuitively understand this problem through a simple table. Suppose your account has an initial capital of 100,000. If you lose 50%, then the account balance will only be 50,000. If you want to get your money back, you need to use this 50,000 to earn another 50,000, that is, the remaining amount needs to double. Obviously, the difficulty of getting your money back increases significantly with the increase in the loss ratio.

Based on this table, we can derive a relatively reasonable drawdown ratio as the boundary for managing risk. I personally prefer to use a 25% drawdown ratio. When the drawdown reaches this ratio, the remaining funds need to make a profit of 33% to get your money back. This payback ratio is more reasonable than the drawdown ratio. Of course, you can also choose other ratios based on your own understanding and risk preference, but the maximum is not recommended to exceed 25%.

In general, when we engage in any potentially risky activities, the first consideration is to determine the boundaries of the risk and act strictly within this boundary. In this way, we can effectively protect ourselves and ensure that our trading accounts can grow long-term and steadily. Remember, risk management is the key to successful trading. Only by reasonably controlling risks can we remain invincible in market fluctuations. I hope this article can make everyone more deeply aware of the importance of risk management and apply it in actual trading. #比特币行情 #比特币大会 #美国PCE通胀放缓 #美联储何时降息？ #美国以太坊现货ETF开始交易 $BTC $ETH