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These 6 iron rules are all very important. If they provide direction, assistance, or inspiration for you in the investment market, remember to follow, like, and bookmark.
Investing in cryptocurrencies can take you from huge losses to great wealth!
1. Regarding Earnings
Assuming you have 1,000,000, when the return reaches 100%, the assets will reach 2,000,000. If you then lose 50%, it means your assets will return to 1,000,000. Clearly, losing 50% is much easier than earning 100%.
2. About Price Fluctuation
If you have 1,000,000, after a 10% increase on the first day, your assets will reach 1,100,000, and then after a 10% decrease on the second day, your assets will remain at 990,000. Conversely, if you decrease by 10% on the first day and then increase by 10% on the second day, your assets will still be 990,000.
Three, regarding volatility
If you have 1,000,000, in the first year you earn 40%, in the second year you lose 20%, in the third year you earn 40%, in the fourth year you lose 20%, in the fifth year you earn 40%, and in the sixth year you lose 20%, the remaining assets are 1,405,000, and the annualized return over six years is only 5.83%, which is even lower than the coupon rate of a 5-year treasury bond.
Four, regarding 1% per day
If you have 1,000,000, and you can earn 1% every day before exiting, then after 250 days, your assets can reach 12,032,000, and after 500 days, your assets will reach 145,000,000.
Five, regarding the 200% each year
If you have 1 million and achieve a 200% return rate for 5 consecutive years, then after 5 years your assets will reach 243 million. However, such high returns are difficult to sustain.
Six, about ten years 10 times
If you have 1 million and hope to reach 10 million in ten years, 100 million in twenty years, and 1 billion in thirty years, then you need to achieve an annualized return of 25.89.
Seven, regarding margin call
Suppose you buy 10,000 yuan of a certain cryptocurrency when it's 10 yuan, and now it has dropped to 5 yuan. If you buy another 10,000 yuan at this price, your average cost will drop to 6.67 yuan, not the 7.5 yuan you might have imagined.
Eight, about holding costs
If you have 100W and invest in a certain currency to make a profit of 10%, you can leave 10W of chips with a market value when you make a selling decision, then your holding cost will be zero, and then you can hold it for a long time without pressure. If you are extremely bullish on this coin and leave a market value of 20W yuan in chips, you will find that your profit will rise from 10% to 100%, but don't be complacent, because if the coin falls by 50% in the later stage, then you may still lose money.
Nine, regarding the asset portfolio
There are risk-free asset A( with a return of 5%) and risky asset B( with returns of -20% to -40%). Suppose you have 1,000,000, you can invest 800,000 in risk-free asset A and 200,000 in risky asset B. Then your worst return for the whole year would be zero, while the best return could be 12%. This is the prototype of the CPPI technology applied to principal-protected funds.
Will the cryptocurrency world be the only way out for ordinary people?
It's been 10 years since I entered the cryptocurrency space, and I want to tell everyone that if you want to change your destiny, you must give the cryptocurrency world a try. If you can't make money in this circle, ordinary people may really not have many opportunities in their lifetime.
Traits of Excellent Traders
First of all, excellent traders must be patient people in order to withstand prosperity!
Market Cycle Theory
"The years of 'five poverty and six absolute' are always like this. According to the cyclical theory, there are actually not many optimal times for trading coins in a year. 'Five poverty, six absolute, and seven may not necessarily turn around.' Every year in May, June, July, and August, I usually stay on the sidelines with no positions."
So, when is a good time to enter the market?
Enter the market at the end of September and exit at the end of November.
Enter the market before the Spring Festival, clear the market in April.
Executing these two iron rules does not, of course, include short-term operations of individual small-cap stocks.
Next, you need to learn how to find hundredfold coins to achieve wealth in a bull market.
Stick to these ten principles when trading coins, and you will definitely reap abundant rewards.
Market Trading Principles:
Don't let low-priced chips be easily taken away: Stay firm in your beliefs and prevent market makers from manipulating the market.
Chasing up and killing down, fully entering and exiting is always a big taboo: In the case of a favorable big trend, building positions in batches during a decline is lower in risk, lower in cost, and greater in profit compared to chasing up.
Reasonable profit distribution: maximize the release of funds, rather than blindly increasing positions and deposits.
Rise sharply, fall sharply and defend the currency: at all times, we must maintain a good attitude, do not speculate, do not be impetuous, do not be greedy, do not fear, and do not do things that we are not prepared for.
Hiding or private placement of low-priced coins relies on experience and judgment: the secondary market games require technology and information, and one should not get the priorities wrong, otherwise it can easily lead to chaos.
Position building and unloading should be done in layers and segments: gradually widening the price levels to effectively control the risk and profit ratio points.
Familiarity with the interconnection effect: Each cryptocurrency does not exist in isolation, and many tools can help view cryptocurrency information and consultation. Understanding these interconnection effects is very important.
Reasonable allocation: The allocation of hot coins and value coins should be balanced; it should neither be too conservative to miss opportunities nor too aggressive to face high risks. Value coins should focus on stability, while hot coins are highly volatile, which could lead to a huge rise or a total loss.
There is currency on the board, money in the account, and cash in the pocket: this is the safest and most secure standard. The grasp of risk control and the reasonable allocation of funds are the key to determining your mentality and success or failure, and spare money investment is the foundation.
Master the basic operations: Learn to extrapolate from examples and grasp the fundamental ideas of trading. Observation is key; remember each high and low point as reference data. Learn to record and summarize materials, develop a reading habit, and cultivate the ability to filter and select information.
summary
By following these principles, combined with the cyclical nature of the market and reasonable capital management, I believe you will gain something in the crypto space. Remember, opportunities and risks coexist in the crypto world; only by mastering the right methods and mindset can you stand undefeated in this turbulent market. I hope these experiences can help you. You might as well follow 【主页看看】 to get the latest information and trading tips in the crypto space.