In the crypto world, there are some cold knowledge or skills that are often unknown, but very important. Today, let's share a few:

1. Cost averaging is not as simple as imagined
For example, if you invest 10U in a certain coin and then add another 10U when the price drops to 5U, your average cost is actually 6.67U, not the commonly thought 7.5U. This kind of situation is very common in market fluctuations, understanding this cost calculation method is helpful for managing positions.
2. The compound interest effect is amazing.
Assuming you have 100,000 U, you will exit with a 1% profit every day. If you can maintain 250 trading days in a year, your assets will increase to 1.3232 million U after one year. Continuing for two more years, the assets could even reach the tens of millions level. Of course, this result is based on a stable rate of return, but the hidden challenge is how to sustain this compounding.
3. The relationship between probability and take profit and stop loss
If your success rate of investment is 60%, and you set a 10% take profit and stop-loss each time, after 100 trades, your total return can reach 300%. But this premise is that you strictly follow your trading plan, not be influenced by market fluctuations emotionally, especially in high-volatility markets.
4. Greed is the biggest enemy
If you start with 10,000 U and make 10% each time, your assets will reach 1,000,000 U on the 49th day, over 10,000,000 U on the 73rd day, and even over 100,000,000 U on the 97th day. However, in reality, very few people can achieve this because most people cannot control their greed during this process, leading to a halfway crash. This is why many traders, even if they make a profit, find it difficult to maintain it for a long time.
Futures trading and position management
In contract trading, position management and fund management are the key to success or failure. Many people use 20%-30% of their capital as the base position, but I personally prefer to use only 2%-5% and leverage of 20 times. This can effectively control risks and avoid emotional decision-making caused by excessive volatility.