Author: ian
Compiled by: Luffy, Foresight News
I've heard many sad stories from investors lately: big drawdowns or even total wipeouts. But don't lose hope. If you've made money before, you can do it again. I've been through a similar experience myself, so I wanted to share some ideas on how to bounce back.
Treat trading as a game
Do you remember the first time you entered the fantasy world of Elden Ring, and how you were beaten by the Tree Sentinel more than ten times before you figured out how to "kite" it? Do you remember the feeling when you finally reached Platinum after being stuck in Bronze for many months?
After countless “rug pulls”, you get your first 5x return on a Memecoin. After months of hard work, you get your first generous airdrop. These moments are filled with dopamine and accomplishment!
Take a break from the hustle and bustle and return to life
At this moment, if you are frustrated by investment failure, you might as well press the pause button first. Return to real life and spend more time with family and friends. Regular work and rest, healthy diet, and hearty exercise will revitalize your body and mind. Treat these daily tasks that seem unrelated to investment as side quests to improve yourself. Just like in the game, if the side quests are completed well, the protagonist's attributes will be greatly increased, so that you can more calmly deal with the main challenge.
You should know that there is no shortage of opportunities in the market. As long as you stay sharp and ready, you can catch them again. But the premise is that you have a healthy body and a clear mind.
Return to the battlefield, strategy first
When you are ready to return to the investment "battlefield", don't rush in. Before you start, write down all the mistakes you made in the last round and make a plan to develop a risk management framework that you must follow.
A qualified framework should include rules for capital allocation, risk exposure, and most importantly, profit-taking rules. I have seen too many investors, driven by greed as soon as they made some profits, rashly reinvest their profits into new high-risk projects, and often end up with nothing. Remember, only when you can put your profits into your pockets, convert them into legal currency, use them to repay debts and thank your family, can you truly be rich.
Travel with the team
If you don't have a team yet, find or create a core group of people to chat with, keep it small, and make sure they are high-quality people you can trust. Playing the game alone is cool, but playing it with a skilled, diverse team is better and more fun.
Resource Management
Now that you're refreshed and have a plan, how do you get started? In every game, you need resources to get the snowball rolling towards victory.
In Age of Empires, you have wood, food, stone, and gold; in League of Legends, you have gold coins, mana, etc.; in chess, you have chess pieces and time; the same is true in investment trading, your funds and time are your resources.
In my opinion, there are two ways to balance these resources when you are starting over or getting stuck in investing:
1. Extreme Maximization Mode
You work in the Web3 space, ideally at a fund or research institute. This keeps you in the game 24/7. The intensity is high, the commitment is high, you are always online, and you spend your free time browsing Twitter and Telegram. Every aspect of your life revolves around cryptocurrencies. Insider information will be sent to you in private messages, and opportunities will appear every now and then.
You level up quickly because you're always on the cutting edge, but it's also exhausting. It's easy to run out of energy. And if you're not careful to leave time for your side quests (like getting back to real life and staying healthy), it's easy to get stuck in tunnel vision. It's the classic trade-off of maxing out.
2. Balanced mode
If you have much less time to invest in this "game", then choose this model. You may have a job in Web2 (where you are good at) or a non-research/investing job in crypto. You don't spend all day on Twitter or hanging out in Telegram or Discord channels.
That’s okay! The operation frequency is low, but the resources are continuously generated. You can still win like the tortoise in the tortoise and the hare fable.
You won't be anxious about every change in market trends. You have time to look at things from a macro perspective, make more confident decisions, and avoid emotional outbursts. You may choose to simply invest in mainstream cryptocurrencies regularly and outperform the average retail trader. If you want, over time you will be able to fund your transition to extreme maximization mode to achieve snowball-like growth in the later stages.
Find your motivation
On the long road of investment, you may want to ask yourself from time to time: Why did you invest in this field? Is it for financial freedom and more choices in life? Or is it to prove yourself? No matter what the answer is, when the account numbers rise one day, you will finally realize that the "game" of investment has been integrated into your life and has become a career that you continue to love and pursue.
