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How to manage our "exposure" when trading cryptocurrencies?

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Good risk control = maximum positive results
Is it possible to avoid risk?
Exposure control to avoid "negative situations"
Gold rules

Without a doubt, this is a vital aspect for the success of a trader in such a diverse sector. Regardless of the economic dimension with which you are trading, negative results can be inevitable, especially in an environment as fluctuating and unpredictable as crypto..

Training with fundamentals that allow managing exposure to minimize "damage" is essential. However, it is also necessary to understand how to use the different alternatives to guarantee the best result. After all, the more you are willing to risk, the greater the potential reward.

Traders with this scenario face the possibility of contrary results in each operation, in fact, the most successful can experience losses on many occasions. However, they get a marked difference between the magnitude of their successes compared to negative results. Regardless of how often you hit, if you don't manage exposure properly, you may end up depleting your funds..

When proper risk control is put into practice, catastrophic results can be avoided. This means establishing a personalized level of exposure, in such a way that it allows you to take measures for adequate “protection” during the day.

Good risk control = maximum positive results

The crypto sector has seen extraordinary development, with significant advances for most assets. In addition, disaggregated finances ignited a passion for cultivating returns and obtaining an attractive passive income, in addition to allowing a whole ecosystem of loans and loans that mark a distance from the traditional financial sector..

Against the backdrop of a struggling global economy, by the events of the last decade and the near negative performance of cash savings, many are turning to the crypto space to compensate.

Is it possible to avoid risk?

Despite misleading offers, there are no ways to avoid exposure in this activity. Successful users of professional services also lose money on different days, but their long-term results are still positive compared to mistakes. Trade easily with the advice and support of Bitcoin Revolution

However, an inexperienced user can achieve successes in most of his executions and, even so, obtain negative results (lose large amounts) over time, considering that he only achieves small amounts in successful operations.

For this reason, the "unwritten rule" in risk management is to determine the ratio of hits and misses to your overall plan, as well as setting an appropriate limit between the 2 possible outcomes.

Exposure control to avoid "negative situations"

Even pro traders, with an impressive track record of industry research, can lose everything in a bad run or two if they don't use proper control; even when they "get carried away" by their hunches. The incentive to achieve a maximum income or to pursue a "particular feeling" can be great, in this case overconfidence can be counterproductive.

To avoid negative situations and allow users to trade with a cool head, it is necessary to use negotiation elements, as well as the most basic management models. These include the establishment of trading rules, such as the different trading options that allow setting a limit (according to different applied tactics) to your losses, fulfilling a programmed action when certain conditions are met.

Gold rules

According to several certified experts in this activity, there are three rules to achieve positive results and each of them focuses on reducing losses. The general rule, especially for those who trade "per day", is not to expose more than 1% in each operation. In this way, you can suffer a series of mistakes (always a risk, given the random distribution of the results), but not significantly affect your funds. A 10% reduction in a trading account can be overcome by using the right plan. However, the greater the reduction, the more difficult it is to recover. If you lose 10% of your capital, you only need a gain of 11.1% to break even. But if you lose 50%, you will need to double your money to get back into balance.

Disclaimer:  The content and links provided in this article are for informational purposes only. islaBit does not offer legal, financial or investment recommendations or advice, nor does it substitute the due diligence of each interested party. islaBit does not endorse any investment or similar offer promoted here.


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