đ Contract Trading | Average Entry Price
¡ What it is: Partially closing a position generally doesnât affect the average entry price of the remaining position; adding to a position does.
¡ How to understand it: Averaging down only makes the average price look betterâit doesnât change the risk the entire position is exposed to. The larger the position, the greater the profit or loss from the same price movement.
¡ In practice: Before adding to a position, consider its size afterward and the corresponding liquidation price. Donât focus only on lowering the average price.
$BTC 82286.63ďź+0.9%ďź
#BTC
This does not constitute a trading signal.
¡ What it is: Partially closing a position generally doesnât affect the average entry price of the remaining position; adding to a position does.
¡ How to understand it: Averaging down only makes the average price look betterâit doesnât change the risk the entire position is exposed to. The larger the position, the greater the profit or loss from the same price movement.
¡ In practice: Before adding to a position, consider its size afterward and the corresponding liquidation price. Donât focus only on lowering the average price.
$BTC 82286.63ďź+0.9%ďź
#BTC
This does not constitute a trading signal.