You have probably heard about the term "Manage risks" and "successful strategy."
But what do they look like in practice?
Suppose, I have $100 and I want to be a profitable trader, what should I do?
I first come up with a basic game plan.
With $100 I can open 10 trades of $10 each.
I follow the coins I want to trade and learn what they are, know the community through binance square and look for good entry.
Which can take 5 minutes to days maximum.
Then I open 10 different trades, not instantly, but slowly or you can wait for 1 trade to finish upto you.
That's it! Simple basic strategy done ✅.
Now very important factor is risk management. First what is risk management?
In simple terms it's a way to ensure you are profitable even when you lose!
Here's what a simple risk management looks like: In a single $10 trade you risk 1:3 — meaning you close trade when you lose $0.5 and take profit when you win $1.5.
Now suppose you lost 6 trades and won 4 trades out of 10. Seems bad right? With only 40% win rate it seems like you are in loss, but no!
You won 4 trades out of 10 and lost 6, but you had a strategy and you managed your risks properly 😉.
Let's see if we are profitable: We won 4x1.5 trade so we made $6.
But we lost 6x0.5 trades so $3 in losses.
So what's the total win/loss?
$6-$3 = $3 in profit🔥
Remember, it's impossible to get a 100% winning trade, but if you manage risks then you can win even if you LOSE 60% or more!
May you journey as a beginner profitable trader be prosperous. 🚀
