In the field of cryptocurrency investment, if you want to achieve a significant increase in wealth, the key is to first accumulate a principal of 1 million. If the starting capital is only tens of thousands, then rolling position operations are a more feasible approach.
Once you successfully have a principal of 1 million, your living conditions will change significantly. Even if you only hold spot assets, when the market rises by 20%, you can easily profit 200,000, which far exceeds the annual income of most people. Moreover, once you can accumulate from tens of thousands to 1 million, you will gradually understand the methods and mindsets for acquiring large amounts of wealth, and your mindset will become more stable, allowing you to follow successful experiences for future operations.
We should not blindly pursue wealth goals of tens of millions or even hundreds of millions but should consider our actual situation. During the trading process, one must have the ability to discern the size of opportunities, avoiding excessive light or heavy positions, and primarily focus on steady trading, fully investing only when significant opportunities arise.
Key points of rolling position operations are as follows:
Be patient. The potential profits from rolling positions are substantial, and success a few times can lead to enormous wealth, so it should not be opened casually; one must wait for highly certain opportunities.
Seize high certainty opportunities. For example, entering during a sideways consolidation after a sharp drop in price and then breaking upward; the probability of a price increase is high during this phase, so accurately locking in the key points of trend reversal and entering the market in a timely manner is crucial.
Focus on upward trend operations.
Rolling position risk analysis:
Rolling position strategies are often considered high risk, but that is not the case. Compared to ordinary futures trading, rolling positions have lower risk. Taking 50,000 as an example (assumed to be profit), when the price of Bitcoin is 10,000, using 10x leverage and a gradual position mode, opening a 10% position (i.e., 5,000 margin) is essentially equivalent to 1x leverage, with a stop loss set at 2 points, resulting in only a 1,000 loss when stopped out; even in the event of a liquidation, the loss would only be 5,000. If the market rises to 11,000, then opening a position with 10% of the total funds and setting a 2% stop loss can still yield an overall profit of 8%. If Bitcoin rises to 15,000 and the position is successfully increased, a 50% increase could yield approximately 200,000; capturing such opportunities twice could accumulate around 1 million.
It is important to clarify that there is no myth of compound interest; turning assets into 100 times their value is achieved through cumulative gains such as two instances of 10 times, three instances of 5 times, or four instances of 3 times, rather than relying on stable daily or monthly compounding of 10% or 20%. The concept of rolling positions itself is not very risky; the real risk lies in the leverage usage. 10x leverage can be used for rolling positions, while 1x leverage is also acceptable. Personal operations typically choose 2 to 3 times leverage, capturing two good market conditions can yield considerable profits, and even using 0.xx leverage is possible, depending on personal choice of leverage, without encouraging high-leverage risky operations.
At the same time, in cryptocurrency investments, it is recommended to limit the amount of capital invested to one-fifth of your total assets, using only one-tenth of your spot assets for futures trading, and focusing exclusively on Bitcoin in futures trading, utilizing 2 to 3 times leverage, thus keeping the risk at a lower level.
Regarding capital management:
Trading risks can be mitigated through reasonable capital management. For example, if the futures account has 200,000 and the spot account fluctuates between 300,000 and 1,000,000+, adjust the capital investment according to the size of the opportunities. If luck is on your side, profits could exceed 10 million RMB in a year; if luck is not favorable, the worst outcome would be a complete loss of the futures account, but spot profits could make up for it, and further investments can be made based on the situation.
Personally, I suggest that ordinary investors take one-tenth of their spot assets to test futures trading. For example, if the spot is 300,000, then take out 30,000 to invest in futures. If liquidation occurs, the profits from the spot can be used to cover it. After experiencing liquidation and reviewing, if one still cannot grasp the situation, then they may not be suitable for this field.
Many people have misconceptions about trading, thinking that with small funds, one can only quickly increase value through short-term trading, which is incorrect. Small funds are more suited for medium to long-term investments to achieve asset growth. Like folding a piece of paper, although initially very thin, after multiple folds, the thickness becomes astonishing. Similarly, small funds should think about how to achieve multiple rounds of doubling of assets, rather than chasing meager profits daily. The smaller the capital, the more one should focus on long-term investments and compound accumulation.
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