Here's what most traders get backwards: they obsess over potential profits before ever mapping out their exit strategy. Flip the script. Before you open any position, ask yourself one thing—what's the maximum I'm willing to lose here? Get that locked in first. Then, build your trade around that number. Risk management beats prediction every single time. Once you nail this part, watch how many of your recurring trading mistakes simply vanish.
This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.
11 Likes
Reward
11
4
Repost
Share
Comment
0/400
tx_or_didn't_happen
· 17h ago
To be honest, I understood this set of theories a long time ago, but when it comes to actual execution, it's still easy to get impulsive. Anyway, stop-loss is always the last thing to consider.
View OriginalReply0
YieldChaser
· 17h ago
Really, setting a stop-loss makes everything simple. How many people dream of making 10 times the profit but get liquidated because they never considered how much they could lose at most.
View OriginalReply0
DefiEngineerJack
· 17h ago
nah see this is where most degens get it fundamentally wrong... they're chasing alpha on the upside when they haven't even formally verified their downside parameters. risk-first positioning is literally just basic portfolio optimization theory but somehow nobody reads the papers
Reply0
FlashLoanLarry
· 17h ago
ngl this is just opportunity cost with extra steps... people always mess up the capital utilization math before they even think about exit liquidity. seen this play out a thousand times lol
Here's what most traders get backwards: they obsess over potential profits before ever mapping out their exit strategy. Flip the script. Before you open any position, ask yourself one thing—what's the maximum I'm willing to lose here? Get that locked in first. Then, build your trade around that number. Risk management beats prediction every single time. Once you nail this part, watch how many of your recurring trading mistakes simply vanish.