Important principles in trading: Don't make small profits, don't incur large losses.

In trading, there is a very important principle: "Don't make small profits, don't lose big money." These eight words may seem simple, but they are actually very difficult to put into practice. For example:
Suppose you opened a position with 50,000, and after opening, the price rose to 51,000. You were very happy, took your profit, and made 5%, feeling great. But the result was that the market continued to rise, eventually reaching 55,000. You only made 5% but missed out on the subsequent 50% increase.
Then you tell yourself that you want to make big money, and this time you will definitely not take profits. So, when the price rises again from 50,000 to 51,000, you decide to hold on and not sell. However, this time the market did not go as you wished, instead it fell back to 50,000 and further dropped to 49,500. You had to cut your losses, losing a portion of your principal.
This situation puts many people in a dilemma, constantly switching back and forth in this entanglement for a lifetime, and they can never get out.
What are the ways to make a profit in both big and small markets?
In fact, there is no way to make money in both bull and bear markets. You need to make a choice between the two. Personally, I lean towards "not making small profits," which means patiently waiting for better opportunities.
Trading is a long-lasting practice.
Whether you are a day trader or a long-term investor, seizing a wave of big market movements and earning a 200% profit, as long as you can preserve most of the profits, you can earn another 200% the next time you encounter a similar opportunity. By compounding this way, your wealth will grow rapidly.
However, if you made a 200% profit this time and then lost it all again, what is the point of all this effort? In the trading market, there is no such thing as "missing out"; there are only two outcomes: profit and loss. Some people may feel that they have found the right path and believe they are about to become wealthy. But in reality, finding the right method only increases your chances of making money.
This method of operation requires a very high level of mentality, patience, and courage. Here are a few key points:
1. Are you willing to be patient and wait for a good position?
- It is very important to patiently wait for the right entry point. Do not rush to open positions out of impatience, as this can lead to unnecessary risks.
2. Are you able to boldly open positions without caring about the principal, even if it means losing everything?
- This mindset is difficult to achieve, but it is also one of the keys to success. You need to be mentally prepared to accept the possibility of losses and learn from the experience.
3. How to cope with various emotional fluctuations?
- The anxiety of missing out, the urgency after making a profit, and the worry of losing after placing an order are all emotional barriers that require long-term practice to overcome.
Summary
Finding the right path is indeed much better than those who play around aimlessly, but it only increases your chances of making money. To truly survive and profit in the trading market over the long term, you need to undergo a long period of training. Here are a few suggestions for your reference:
- Be patient: Don't rush to act, wait for the best moment.
- Control risks: Even with high confidence, set stop-loss points to protect your principal.
- Stay calm: In the face of market fluctuations, maintain a calm mindset and do not be swayed by short-term gains or losses.
The trading market is a long-term battle, not a sprint. I hope these experiences and suggestions can help you move more steadily and further on your trading journey. Remember, finding the right path is just the first step; the real challenge lies in whether you can persevere and continuously optimize your strategy. #BNBChainMeme热潮 BTC #ETH GT#美联储3月利率决议