Why Do Many Believe the End of Trading Is Liquidation?

Many traders think that continual trading often leads to liquidation. Theoretically, if you keep trading, your funds will gradually diminish until they reach zero.

Consider this example: With a principal of 10,000 yuan and a 50% win rate, if you profit 1,000 yuan and then incur a loss of 1,000 yuan, factoring in a 100 yuan handling fee, your result would be:

1,000 (profit) - 100 (fee) - 1,000 (loss) - 100 (fee) = -200 yuan.

Even with equal chances of profit and loss, the handling fees lead to a net loss.

Looking at profit and loss ratios—say 10%—while keeping the principal and fees constant, your result would be:

10,000 × 10% - (10,000 + 10,000 × 10%) × 10% - 100 - 100 = -300 yuan.

Including spreads could worsen these losses. Theoretically, continuous trading could lead to losses until your principal is exhausted.

In reality, the odds of losing are often higher for most traders because successful ones typically have an edge.

This highlights the importance of improving your winning rate to sustain participation in the market. If you're feeling confused about trading and want guidance, follow me and comment "1" to start your journey to wealth!#BTCSoarsTo68K #BinanceLabsInvestsLombard #APESurge #CanaryLitecoinETF #Write2Earn!