Cryptocurrency Circle: Dream of getting rich or facing zero? Real Cases and Beginner's Guide
A friend of mine worked hard in a factory for half a month to accumulate funds and lived frugally. However, after get off work, he couldn't wait to recharge the hard-earned money to Binance, hoping to realize his dream of getting rich overnight through high-leverage contracts. However, he didn't know that he had quietly fallen into a well-designed trap. In the end, not only did he fail to achieve financial freedom, but he fell to the point of borrowing money from me to make a living.
For novices who are new to the cryptocurrency circle, I have a few heartfelt suggestions:
Many friends blindly pursue high leverage, 10 times, 20 times, or even 50 times, 100 times. However, once funds flow in, they often face the risk of liquidation overnight. Participants in high-leverage can be roughly divided into two categories: one is gamblers who are keen on small bets, they like to stud and pursue excitement; the other is novices who lack operating experience and do not know how to reasonably plan their positions, resulting in the end of contract transactions before they even start.
In contract trading, position management is crucial. It can maximize the benefits of funds and effectively avoid risks. So, how to manage positions scientifically?
Flexible use of funds is the key. For example, if you want to open a position of 10000U, you can choose 1000U-10 times or 500U-20 times. At the same time, setting a stop loss point is also very important, and it is recommended to control it between 1%-3%. Use 10% of the funds to gain 100% of the profit, even if the loss is within the controllable range. On the contrary, if you blindly pursue high leverage, such as 10000-10 times or 10000-20 times, once the market fluctuates, you will have no tolerance for error, and it is easy to lose the principal, and even lead to a distorted mentality.
Using high leverage for speculation, it is normal to blow up the position, and making money is accidental. Therefore, before using contract trading, please be sure to understand the basics, such as leverage multiples, funding rates, etc. If you don’t understand anything, once the position is blown up, you will only blame the tool itself. So, please be sure to plan your position reasonably and invest carefully.