First, why should I separate positions?
Because contract transactions have a leverage ratio, the profit or loss of each transaction is a huge amount.
Principal USD 100 x 50 times leverage = USD 5,000 to place an order
In the profit state, it is multiplied by 5,000 US dollars at a rate of%, and the loss state is also equivalent to the rate multiplied by 5,000 US dollars. Therefore, there is a risk of liquidation of the transaction, and the liquidation of the contract is also terminated. The loss ratio is about 95%, and the system will automatically settle the order, and cannot continue trading.
If you place an order of 100 US dollars, the loss will be about 95%, and 100 US dollars will be automatically lost.
In the case of profit, there is no upper limit, which can be 300%, 2000% or 150%. Because of the risk of liquidation, the technique of separating positions is a very important deployment!
Second, the separation skills
It is recommended that the funds be divided into 10 equal parts and made into 10 positions.
Take the following figure as an example:
1. The K-line chart is down. If you place an order to buy more, you are advised to place 1 equal amount of funds, which is 10%.
2. Always keep an eye on the market, when it continues to decline after rising, you can make up 2 equal funds, which is 20% raise.
3. Observe that the market continues to decline without reversal, and you can make up 3 equal funds, which is 30%.
4. The above examples 1, 2, 3 are one of the cases.
If the order suddenly rises when 10% of funds are placed , it is recommended to find a profit point to take profit. If the market continues to fall, 20% of the order is placed to cover the position, and it stops until the position is filled to 30%. The remaining 30% should be reserved as a reserve.
Timing of margin call:
Can be based on the spread of 30, 50, 100 US dollars
When the market declines, it will cover the position with 50 US dollars, the second fall will cover 100 US dollars, and the second fall will cover 150 US dollars, until the market rebounds to profit.
Novice recommends a profit of 10% ~ 20% Take Profit (profit close out)
The stop loss part can be increased by 5% -10%, that is, 15 ~ 25% stop loss and close out.
Every trade must pay attention to the importance of take profit and stop loss. In the contract trading market, you can control the profit and loss of transactions with multiple orders.
Each trade of 100 US dollars, 6 times out of 10 profits, is a win.
Each trade of 100 US dollars, profit 3 times, the fourth transaction is placed as high as 300 US dollars, if the market declines, the loss of positions will indirectly affect the previous profit.
It is recommended that novices start to familiarize themselves with the market, control the profit and loss of each transaction, and keep a fixed profit.
Each transaction is 100 US dollars, 10 wins and 200 US dollars profit, it is recommended to withdraw 100 US dollars. The remaining profit of $ 100 will continue to place orders until you are fully familiar with it before considering increasing the order amount.