The Golden Rules of Risk Management

There are old traders, and there are bold traders. But there are very few old, bold traders. Survival in crypto depends on one thing: Risk Management.

Rule 1: The 2% Rule

Never risk more than 2% of your total portfolio on a single trade.

• If you have $10,000, your max loss on one trade should be $200.
• Why? You can lose 10 trades in a row and still have 80% of your capital left.

Rule 2: Risk/Reward Ratio (R:R)

Never enter a trade unless the potential Reward is at least 1.5x the Risk.

• Risk: $100 (Stop Loss distance)
• Reward: $200 (Take Profit distance)
• Math: Even with a 40% Win Rate, you will be profitable over time.

Rule 3: Stop-Losses are Non-Negotiable

"I'll just watch it" is a lie. A market crash happens faster than you can click sell.

• Always program a hard Stop-Loss into your Bot Settings.

Rule 4: Don't Marry Your Bags

Emotional attachment to a coin leads to ruin. If the market structure breaks (Bearish Cycle), cut the loss and move on.

Protect your capital, and the profits will follow.