After participating in the market for a while, I noticed that you guys lost quite a lot, so today I analyze to show you why they lost. Hope to be of some help to you.
LACK OF INFORMATION
- Dev information of that coin: Team Dev missed holding enough money to go to Las Vegas to gamble and then don’t care about it anymore. The child it gave birth to it doesn’t care anymore, who cares about that Coin anymore to buy it.
Example: Dog DOGE…. - Is the information about the coin about to be wiped out on the exchange?. If you accidentally hug coins that are about to be wiped out on Polo, Bittrex for example. Too much negative money in Balance. What should I do?
- Other information….
High transaction fees
- One transaction you lose 0.25% Polo fee or 0.5% Bittrex fee and 0.25% primexbt. You try to calculate how many orders you trade in a month and multiply it depending on your Balance. If your account is small you will not see clearly but the large account is completely different. Although it is very small, it will WASH gradually and your account will gradually decrease.
- Even if you don’t lose. It means that your initial account is $ 10,000 after 1 month of trading your account is still $ 100,000, in fact you have won a lot regardless of the number of your trading orders. If you trade less, your winnings are small and conversely, the more you trade, the more you are winning. But the other winnings are temporarily you have to pay to the floor. So you are like an unpaid employee.
- Did you pay attention that when you order, you will also lose the same fee? That fee is the difference of BID, ASK, sometimes you want to get out quickly, you may set the price higher or lower depending on whether you are buying or selling. So, the floor will be added that fee. Exchanges live on transaction fees mainly. So, those of you who are passionate about surfing, check it out.
- I’ll do an example: Assuming your account is 10,000$, every time you enter the ALL IN order to go for it, you lose 10,000$ * 0.5% = 50$. So make an Excel table, then after 139 times you enter the order you have $ 5007. So need to go in and out 139 times, you will lose 50% of your account, regardless of whether you win or lose. If you enter about 3 times a month, 16 days, you will evaporate 50% of your account. The number looks small, but the calculation is terrifying.
if you have bitcoin cash, you can see this post: Coinbase will accept Bitcoin Cash on January 1, 2018?
LEGAL LIABILITY
When you buy a certain Altcoin, but don’t know about it, accidentally click Buy, then sit back and don’t know what the future will be like.
One fine day you need money and want to sell some to take care of your work, but when you click sell, no one buys. Only then will you know that the coin is not liquid. Because it is an extremely lousy coin for people not to take let alone sell. You can refer to the yobit.net floor, which has many types of coins.
NO CAPITAL MANAGEMENT
When you do not manage capital, the following can happen:
- You follow someone who believes this bet is good and all hands (ALL IN says as if Poker is still Play). At that time, 1 is the first you do not consider. I just consider that at that time the Coin you bought it dropped dramatically. And in that moment you see a lot of opportunities. You want to buy potential coins, but your account keeps getting smaller and smaller and you can’t continue with your plan.
- When you do not manage capital, it will lead to extremely bad risks. You accidentally hugged a bad altcoin but the amount of money you bet on it has a lot of % in your account. In the bad case it plugs into the ground like SC or DGB for example, what should you do? I still have to click my tongue and say: “Ignore it, it won’t come up anyway”. That is, I have not calculated the Spread = The coefficient between ASK and BID when you enter the order.
- You see that the DGB dropped from 2300 sts to 250 sts. If you hug, TK will almost fly away.
Conclusion: Please manage capital closely, set aside a necessary amount of capital to save for times of need. Just like you always save some money for unforeseen circumstances such as sickness, illness or ….