Why do we carry out contract transactions? What are the strategies for Xiaobai contract trading?
Speaking of contract trading, it can be said that it is a very popular investment method in the currency circle. In fact, contract trading has appeared in the currency circle as early as 2013, but few investors in the currency circle would carry out contract trading at that time. However, with the development in recent years, more and more investors have become interested in digital currency. Therefore, more and more investors invest in virtual currency. People's requirements for digital currency investment have become very abundant. It is for this reason that contract transactions have become very popular. So why do we carry out contract transactions? What are the strategies suitable for Xiaobai contract trading? Next, let's take a look.
Why do we carry out contract transactions?
1. The contract transaction can achieve more with less
With the rise and rapid development of the cryptocurrency market, the dividend period for property prices such as BTC and ETH to rise thousands of times has passed, and the price fluctuation of mainstream cryptocurrency assets is becoming smaller and smaller. With the involvement of traditional investment institutions, it is increasingly difficult for ordinary people to complete asset appreciation based on digital currency transactions.
Although the income from investing in mainstream encryption assets such as BTC and ETH is getting smaller and smaller, we can enlarge the profit through contract trading. After all, the contract is applicable to leverage trading. I think everyone has heard of the case of using leverage to make more with less. When the cryptocurrency market crashed a few days ago, I heard that a girl made 10 million yuan. She just used the contract to trade short at a high time.
Leveraged multiple trading is the most attractive point of contract trading. When you use contract trading, you can take a small amount of assets to gain a higher rate of profit.
2. Convenient completion of multiple transaction strategies
As we all know, compared with other financial systems, the cryptocurrency market fluctuates relatively large. From the overall market trend, the number of days of bull market is much less, and most of the time the market is in a bear market cycle. This means that for us, we have to face a long bear market.
If you only do spot trading, you can make money only if you grasp the short bull market. But if you do contract trading, you can make money no matter whether the market rises or falls. You can be long when the market rises, but short when the market falls. In other words, after opening the contract transaction, everyone has a lot more opportunities to make money.
3. Hedge risk
In crypto asset transactions, contracts can be used to hedge the risk of market fluctuations, which means that traders can simultaneously make multiple bets in the opposite direction to minimize the risk of high losses.
For example, if you have $20000 BTC property in stock, you don't want to exit the market even if the price adjustment is large, then you can use the contract to hedge the risk.
You can set the BTC short position with 10 times leverage using USDT of $2000 (also equivalent to $20000). At this time, if the price of BTC plummets, the spot value of BTC you own will be greatly reduced, but your short position of $2000 with 10 times leverage will allow you to earn back your spot loss in the contract market.
What are the strategies for Xiaobai contract trading?
Before invoicing: do a good job in fund allocation
Make sure that there should be not only currency but also USDT in the account, and there should be prepared funds outside the market to cope with extreme market conditions. The funds in the contract should not exceed 50% of the personal property funds, and the funds in each billing transaction should not exceed 10% of the contract account funds. This kind of behavior can effectively reduce the transaction risk, even in the face of some extreme market conditions, there is sufficient funds to operate.
1. Control the frequency of transactions: frequent contract transactions not only easily affect the mentality and reduce the winning rate of transactions, but also increase the transaction costs. The service fees accumulated over a long period of time are also a significant amount.
2. Set stop loss and stop profit: After the order transaction is successful, set stop loss and stop profit in time, especially the application of stop loss function. It is difficult for you to figure out where the bottom and top of the contract market are, and the clever setting of stop loss can make you continue to enter the market even if you are in the wrong direction.
3. Don't take others' advice lightly: Some people often doubt themselves when they see the firm offer of some so-called "trading experts" or hear that the directions of their friends are inconsistent with their own. In fact, there is no winner in the investment market, even Buffett. If the order is made based on his own rational judgment, there is no need to change it easily.
1. Overcome greed: greed is human nature, but to win in the contract, we need to learn to restrain. When making profits, it is necessary to stop the profits in time and put the bag in the bag. When dealing with the loss, the loss limit exceeds 10% of the total position. At this time, the risk is high. It is proposed to close the position decisively and adjust the status before entering the market. Don't take chances. According to the painful experience of countless investors, if you carry on, you will only lose more and more, until you are in a position of short.
2. Learn to summarize: We should summarize after completing a single order. The market is our teacher. Whether it is profit or loss, adjust your mind, timely summarize the experience and lessons brought by each order, and constantly improve the trading strategy, find the strategy that belongs to your own trading style and trading method, and then improve the trading tolerance.
Having said that, I believe you have a certain understanding of why to carry out contract trading and what strategies are suitable for Xiaobai contract trading. In general, Xiaobian also reminds investors that although the current investment in digital currencies is very hot, the currency market is volatile and unpredictable, and investment is accompanied by certain risks. Whether you want to carry out contract transactions or not, you should have a comprehensive understanding before entering the market, and do not invest blindly.