My trading thinking.
Everyone's thoughts and actual situations are different; this is just rambling, hoping to spark ideas, and let’s improve together.
My understanding of trading: to achieve big gains with small investments while minimizing risks as much as possible and maximizing capital efficiency.
I will talk about my current and upcoming operations.
Personal situation: I have invested a total of 4,000U in the copy trading account, and from the previous wave, I made a little profit and withdrew 200U, now I have 4,700U. I am planning based on a principal of 4,000U.
First, determine your maximum tolerable capacity: losing all account funds (liquidation). Of course, I believe that following my methods and strategies, a large loss is possible, but the likelihood of liquidation is low; if I were to liquidate, I guess there would be a queue on the rooftop.
The first step in operation is to assume a direction for the market, whether it’s going up or down (the judgment of whether it’s going up or down is actually not important; whether to buy long or sell short is also not important, it's just a starting point. You can listen to experts, rely on your feelings, or flip a coin; this is not important, but having a direction to start with is helpful).
Now I assume this is a major pullback in a bull market, the bull market is still ongoing, and it has pulled back a lot; the market will rise, so I will focus on going long.
The second step is to buy the asset.
You can buy any assets you like based on your feelings, but you must diversify the currencies to spread the risk. For instance, to exaggerate a bit, buy 100 different types; in reality, it's very hard to buy so many. If you invest 100U in each type, the total position will be 10,000U, and the leverage will be 10,000/4,000 = 2.5 times. It looks very high, but in reality, the risk is not that great.
I won't set a stop-loss on my first purchase.
After buying, I will short a few that have risen too high to balance the overall position a bit.
The third step is to wait for the market direction.
(1) If the market meets expectations, most will rise.
Put aside those that have declined or haven't risen much and ignore them.
I set a standard that when it rises to 5%, I will increase my position and set a cost stop-loss. If it rises again, I will add more and keep the stop-loss at the cost price. When it feels about right, I will close the position.
(2) Not meeting expectations, most of them declined.
In fact, this situation is not very risky; although most are declining, there will always be a few that rise. The rising ones can be operated on as per the previous steps to hedge the overall risk. Previously, I also shorted a few, which should also hedge some risks, so the real risk is not that high. Of course, extreme situations are an exception; if most fall and all shorts rise, then it’s doomed; there's nothing to be done; that's fate.
About copying trades:
There are two reasons: First, the greatest enemy of trading is loneliness; trading is destined to be lonely, and in reality, there are basically no people who can understand you. Even among traders, communication is difficult. Copy trading can alleviate loneliness, and the good thing about being online is that when you're in a good mood, you can post several times a day; when you're not feeling well, you can post once every ten days or half a month. If you did this in real life, it might offend many people. Anyway, since we're all trading, it doesn’t matter where you do it; using a copy trading account is still trading. The second reason is, of course, money; if the copying brings profit, I can take a share, haha.
Regarding the advice on copying trades: I personally do not care about this right now; if you want to follow, then follow, if you don’t want to, then don’t. My trades are based on my actual situation, which may not suit you. If you make money from copying, don't thank me; I will take a small share; if you lose money, don't blame me, accept your fate; no one forced you. If you really want to follow, the amount should preferably be greater than my capital, and you need to extend the timeline to reflect the results.