Investment expectation management - risk line management. Recommended reading: ★★★★


Only by making good investment expectations and managing expectations well can you lock in your own profits in a volatile market.
Why do I say this? Because the crypto market has lost the support of macro narratives and independent narratives recently, the overall market has fallen. Bitcoin has not fallen below 60,000, but the Shanzhai market has been bleeding. The former Soha MEME lived in the palace, and no one knows what they are doing now. The largest holdings of retail investors are still Shanzhai, and many retail investors also rely on Shanzhai investment to make profits.


Therefore, in the case of a general decline in the altcoin market, many people have begun to complain bitterly, torture themselves, and consume themselves. In addition, seeing all kinds of negative news on the Internet, they can't hold on, and it is inevitable to sell at a loss. This situation can occur mostly because retail investors do not do a good job of risk expectation management.


There are a few points to note in advance:
1. The investment market has never been a place to make money. Every penny is made with the blood of others. Whoever loses money also loses his own blood.
2. If you want to read information, it is recommended that you start to manage information slowly when the market is not good. Basically, you can filter out information that is meaningless, creates anxiety, and brings FOMO to people according to your own situation, because excessive guidance of emotions will amplify risks. At the same time, after screening, the news you can see will be relatively clean.
3. Those who know how to buy are apprentices, and those who know how to sell are masters. This is actually a classic, but many people do not understand it. When the market environment is good, it is not difficult to make money by buying, unless you estimate that you will step on some small probability pits. Instead, it is very important to verify and lock in profits. People with a keen sense of smell often start to choose selling points when the market is overheated, while most retail investors dare to buy only when the market is hot, which leads to their own costs being too high, or entering the market to take over.
4. There is no permanent profit in the secondary market, and the same is true for trading. In the past two or three decades, we have heard all kinds of legends about making money, but it is difficult to judge whether the money can be cashed in or retained. Because human perspective is too slow, and a person's peak to trough often takes a cycle, often several years or more than ten years. In fact, strictly speaking, as long as the money does not leave the secondary market, it is not considered as your profit. Smart high-net-worth people will slowly choose a more stable investment method for profitable assets, or build their own investment portfolio. They will never put all their eggs in a high-risk basket. Because success requires accumulation, and failure may be irreversible once.
5. Lower your confidence, especially when you are making a profit. Many people can make a short-term profit by catching up with the market hot spots or stepping on the right timing, but once you think that these are all caused by your own ability, it is the beginning of a huge loss. The market is sometimes like a vampire, often using small profits to attract you to invest more, and then harvest you.
6. If you choose to invest, it means that you have implicitly acknowledged the risks of a certain market, so after investing, you should not blame others for any gains or losses, of course, being fooled is another matter. So before you invest, you must learn to manage your expectations.


Managing expectations is actually a relatively complex topic, even for buying and selling. When to buy firmly, when to sell firmly, set an expectation, and then wait for your expected position to be triggered. The most difficult thing is to ignore the subsequent market trend afterwards. Don't regret it, don't regret it, don't regret it. I will say it three times. Regardless of profit or loss, you can recommend a review, but don't regret it, because every regret is digging a hole for your future. Because a large part of investment profit is actually also a component of luck and market environment.
Today I will share the simplest expectation management - risk line management.


I don’t need to go into detail about the specific official explanation. This risk line management is relatively macro and may involve the entire investment field. Those who are interested can check it out for themselves. Today I will use easy-to-understand words to tell you how to apply risk line management to investment.


The benchmark is still to manage expectations first. For example, for BTC, in my understanding, 57,000 is a buying price (hypothesis), so I will wait to buy at 57,000, place an order or wait for the market to reach that point and then operate on my own.
Then if I plan to use 1 million to buy, I have to consider what is the maximum loss I can accept when I buy this 1 million. If I can only accept a loss of 500,000, I have two options at this time.


If you think you have a good mentality, then buy 1 million, and the market will trigger my maximum loss line when it drops from 57,000 to 28,500, and then I will decisively stop loss at this position or observe at any time. If you think you have a bad mentality and you can only accept a loss of 500,000 out of 1 million, then you can only invest 500,000 to buy, so that your original Bitcoin needs to drop by 50% to trigger your risk line, but now it becomes Bitcoin returning to zero to trigger your risk line expectation of losing 500,000.


When you understand the market and the risks, and manage your expectations, and then set a reasonable risk line, you will find that you will be more calm when facing a decline in the market, and you will not be mentally exhausted or anxious. And you will gradually find that when you can stay calm in the face of losses, you will make more rational judgments.


Please remember that investment is a rational thing. Although the outbreak of memes and the sudden wealth have overturned this theory, in fact, those who can get rich through memes are only legendary. If you believe that you can do it, why not just buy lottery tickets? In fact, the probability is the same.


Finally, I hope that in this short period of decline and adjustment, everyone can ignore each other more, communicate more rationally, learn more, be less pessimistic, and create less anxiety. Finally, I hope everyone can encourage each other and achieve their goals in this bull market.

#BTC走势分析 #风险预期管理 $BTC