99% of people lose money trading. Here is how you don’t.

Covduk
10 min readMay 9, 2022

99% of people lose money trading.

This is largely because of a lack of proper frameworks & trade management.

I’m watching from gigabrain trader CryptoCred’s amazing youtube series on trading & technical analysis from 0.

I just finished part 2: Trade Management. I took detailed notes & made it into a post. This 1 article will make you a 10x better trader.

Today, we’re diving into risk & trade management. We’re covering:

  • Trading Ideas & Invalidation
  • Stop Losses
  • Position Size
  • Risk per trade
  • Dynamic Risk to Reward
  • Winning & Losing Streaks
  • Break Even stops & Partial profits
  • An intro to leverage trading
  • Some Crypto Considerations

Let’s get started.

Survive.

Crypto disproportionally rewards people who stick around. Even mediocre traders who stick around have been making a lot of money. You need to ensure that your experiments as a beginner trade don’t take you to 0.

As long as you don’t go to 0, you can

  • Experiment & find edges
  • Act quickly on those edges

Your biggest winners are likely going to come from a handful of trades. You need to ensure you’re in a position to act on them.

Never risk your ability to take a risk.

Invalidation

When you take a risk & make a trade, you do it based on some sort of idea that you have. Your idea or thesis should be falsifiable.

There should be some data other evidence that invalidates your idea. Invalidation is when your idea is (almost) certainly wrong. You should be able to articulate what your invalidation is. If you can’t think of one, you should reconsider.

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Covduk

I write crypto 101s, dive dives and how tos. Crypto | NFTs| DeFi