After four years of professional trading, I can now earn $2000 a day without issue. In the cryptocurrency world, there are some lesser-known tips or tricks that are often overlooked but are very important. Today, I’d like to share a few:

1. Cost averaging is not as simple as it seems.

For example, if you invest $10,000 when a cryptocurrency is priced at $10, and then you add another $10,000 when the price drops to $5, your average cost is actually $6.67, not the $7.5 that many people think. This situation is quite common during market fluctuations, and understanding this cost calculation method can help in managing positions.

2. The power of compounding is astonishing.

Assuming you have $100,000 and earn 1% daily, you would exit the market. If you can maintain 250 trading days in a year, your assets will grow to $1,323,200 after one year. Continuing for two years, your assets could even reach tens of millions. Of course, this result is based on stable returns, but the challenge behind it is how to consistently maintain this compounding.

3. The relationship between probability and take-profit/take-loss.

If your investment success rate is 60%, and you set a take-profit and take-loss of 10% each time, after 100 trades, your total return can reach 300%. However, this premise relies on strictly following your trading plan and not letting market fluctuations affect your emotions, especially remaining calm in a highly volatile market.

4. Greed is the greatest enemy.

If you start with $10,000 and earn 10% each time, on the 49th day your assets could reach $1,000,000, and by the 73rd day you could surpass $10,000,000, with a chance to go over $100,000,000 by the 97th day. However, in reality, very few people can achieve this because most cannot control their greed during the process, leading to failure midway. This is why many traders, even when profitable, find it difficult to sustain their gains over the long term.

Contract trading and position management.

In contract trading, position management and capital management are key to success or failure. Many people use 20%-30% of their principal as the base position, but I personally prefer to use only 2%-5% and employ 20x leverage. This approach effectively controls risk and avoids emotional decision-making due to excessive volatility.