I see many respondents saying they've opened 5x or 10x leverage, claiming that it's already quite small.
I am really speechless. In fact, I want to tell you all, you're all wrong.
Leverage is not calculated this way. The leverage ratio calculated by the platform has nothing to do with you; it’s roughly the proportion affecting the platform’s safety. You should calculate risks based on stop-loss or sufficient principal.
In the crypto world, where volatility is so high, it's best to open positions in phases evenly, with each capital around 10-20%. The total position should be capped at 2 (short) to 4 (long) times the capital. At any given moment, the overall stop-loss risk should be within 20% of the capital (or the psychological actual tolerance must be less than 20%). It is recommended to average the risk over time at 10%, meaning there will be periods of no positions... Some may ask, then why engage in contracts... Haha... To say something that might offend the entire crypto community, do you really want to earn coins or make money? Is there a more flexible speculative tool than contracts? Is U-based trading really useless? As a bear market approaches, what is safer, coins or U? When you spend money, are you spending coins or U?
Friends in the crypto community, engaging in contracts (pure speculation) is completely different from investing in cryptocurrencies (similar to venture capital).
The essence of contracts is trading risk. Or rather, using risk management and expectations to make money.
When engaging in contracts, you must clarify this statement.
You can choose not to believe in technology, not to believe in manipulators, not to believe in K-lines or moving averages, not to believe in BTC, and think they are all scammers. Conversely, you can believe in them; these conceptual issues won't hinder your ability to make money.
But there's one thing you must understand, and that is [risk]: what is risk, how to manage risk, how to calculate risk, how to operate risk, how to withdraw from risk... how to survive...
-------You cannot earn money beyond your cognitive range... Originally, if you invest in a coin and its value doubles, you earn 100%; then if you engage in a contract at 3x, resulting in 300% profit, do you know where that extra money comes from?
——For contract trading, what you earn is actually the money from risk management, which is the money given to you by others' losses and liquidations, and to get this money, first, you cannot be liquidated...
In fact, looking at the market from the perspective of [risk] is completely different from how ordinary people view the market. It's like looking at a mountain from the bottom versus viewing it from the top; they are fundamentally different. For example, people buying coins can hold their positions and wait for a rise, endure losses, and emphasize patience... But in contracts, if you hold a position and wait, enduring losses, you probably won't survive the first three episodes.
Therefore, operations based strictly on [risk] management are completely different from operations based on [dreams]. In the trading market, dreaming costs money, while those managing [risk] strive to grab that money.
So, do you want to be a [dreamer] or a [risk manager]? That depends on you. However, [dreamers] shouldn't engage in contracts, as dealing with contracts can shatter annual dreams within days; waking up is just too quick.
Anyone who has made a significant amount of money will feel something during the process: 'That period was almost like picking up money.' More or less, but—when your opportunity arises, that is to say: when it’s your turn to pick up money, you must be alive and have the capital to do so.
Yes, making money from contracts isn't difficult... After all, there are so many people who blow up their accounts and hand over money. They are racing on the edge of a cliff; you just need to wait at the bottom and pick up a few parts to get by.
The difficulty lies in the fact that it is inherently against human nature. Basically, you have to think contrary to the common person's idea of 'getting rich overnight.' Whenever you are eager to increase your position or open a position, you should think about what it means to [go against human nature].
...If buying coins is fishing, then engaging in contracts is stepping into a boxing ring... So I say, there’s plenty of time for being in a flat position; that's very normal. Waiting, testing, retreating, trying again, waiting... this is the normal state of a successful speculator.
In fact, strategies over a period of time are almost straightforward and can be said to be well-known.
For example, on February 14, 2022, many teams' trading strategies are: shorting most cryptocurrencies while timing to long BTC as a hedge.
There's no need to talk much about the reasons; just think of yourself as a big shot in the crypto world and deduce from there. With such an absolutely profitable strategy, 80% of people operating contracts can't make money.
And such a simple strategy actually contains countless details. For example, the simplest operational principles, why not short directly based on BTC, why shorting is much more conservative than longing, and the holding period is much shorter when shorting. How to handle stop-loss in shorting, how to short various technical cryptocurrencies... Regarding stop-loss plans in contracts, theoretical backing is necessary and worth learning. The value of stop-loss theory is at least half the value of what you invest in contracts. If you truly can't find it, you'll have to derive one yourself (that's what I did; I found someone, but they were unwilling to teach, so I derived a set myself). A complete set of theory means a complete set of operations; strict execution means there will always be opportunities.
Trading is like this: superficially, it seems extremely simple—a buy and a sell (one minute on stage), but countless people have worked hard behind the scenes (ten years of effort off stage)... In general, this is a profession. It’s not to say that novices can’t do it, but you must seriously study and train before you can truly participate.
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