After losing money, do you always want to immediately make it back? This mindset almost destroyed me.

#加密市场下跌15万人爆仓 In the previous article, I talked about how to defend yourself with tools. Today, I want to discuss a more painful topic: position sizing.

I have blown up my account. More than once. Later, after reviewing, I found that each time I reset to zero, only about 30% was due to technical reasons, and the remaining 70% was all due to poor position management.

I summarized three ways I have died in trading, and how I changed afterward. Not all of them are perfect, but each one was earned with real money.

First way of dying: Going all-in with full position
Seeing someone in the group shouting about a hundredfold secret, I impulsively went all-in. When I won, I thought I was a god; when I lost, I reset to zero. I once turned 3,000 yuan into 30k yuan, then gave it all back to the market in one day. It wasn't the market that killed me; it was me handing my life over to luck. Going all-in is like betting your life; if you win, you'll keep betting until you lose everything.

Second way of dying: Increasing position after losses
Losing and feeling stubborn, thinking to add a little more to lower the average cost. The more I fell, the more I added; the more I added, the heavier I became, until I was stuck in a bad position and couldn’t move. This isn’t strategy; it’s throwing a tantrum. The market doesn’t care about your costs; it only cares if your margin is enough.

Third way of dying: No stop-loss
Clearly set a stop-loss level, but when it hits, I deceive myself: “Hold on a bit longer, it will come back.” Manually moved the stop-loss down, until I finally got liquidated. The more times I held on and recovered, the more daring I became to hold on next time. Until that one time, when I never looked back, and it took everything.

How I changed
After blowing up my account and being afraid, I set three strict rules for myself. Since then, I’ve never reset my account to zero again.

First rule: No single trade exceeds 10%
No matter how optimistic I am about a certain asset, I only risk at most one-tenth of my total funds on a single trade. Even if I lose that trade completely, I still have 90% of my capital left.

Second rule: Total position size does not exceed 50%
Always keep half of my funds in cash. It may seem like I’m earning less, but when a sharp decline comes, having money in hand is a different life from having no life.

Third rule: Accept the stop-loss once set
When the stop-loss is in place, I walk away at that level—no moving, no holding. If the stop-loss gets hit, I can earn it back next time; if the principal is gone, everything is gone.

These three rules are simple, but very difficult to follow. Because they go against human nature—they oppose the greed to turn things around overnight, and the impatience to win back immediately after losing.

But it’s these three rules that turned me from a gambler who could lose everything every month into someone who can survive in this market. Position management isn’t for making big money; it’s for never being kicked out of the game.

As long as you’re still at the table, there’s a chance. Once you’re kicked out, everything is gone.