Tips for making money with perpetual contracts (Part 2)
3. Specify stop-profit and stop-loss targets
Stop-profit and stop-loss can be said to be the key to determining whether you can make a profit. In several transactions, we must make the total profit greater than the total loss. It is not difficult to achieve this. Just do the following:
① Stop loss ≤ 5% of the total funds;
② Profit each time > 5% of the total funds;
③ Total transaction win rate > 50%
If the above requirements are met (profit-loss ratio greater than 1 and win rate greater than 50%), you can achieve profit. Of course, you can also have a high profit-loss ratio and a low win rate, or a low profit-loss ratio and a high win rate. Anyway, as long as the total profit is positive, the total profit = initial principal × (average profit × win rate - average loss × loss rate).
4. Remember not to trade too frequently
Since BTC perpetual contracts are traded 24 hours a day, many novices will trade every day. They wish they could trade every day for 22 trading days a month. As the saying goes: If you walk by the river often, you will get your shoes wet. If you operate too much, you will always fail. After you fail, your mentality will deteriorate. Once your mentality deteriorates, you may act impulsively and choose "retaliatory" operations: you may go against the trend or hold a large position. In this way, you will make mistakes step by step, which can easily cause huge losses on the books, and these losses may not be recovered for several years.
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