A seasoned market analyst, Peter Brandt, offers a rigorous guide for those looking to dive full-time into crypto trading.
With years of trading experience, Brandt outlines essential tips aimed at aspiring traders who wish to transition from day jobs to trading as their primary source of income.
8 Tips for Crypto Traders by Peter Brandt
Firstly, Brandt emphasizes the importance of genuine trading skills over luck. Aspiring crypto traders should rely on their abilities rather than hoping a single market bet will pay off. He advises traders to ensure they have substantial account capital.
“Multiply your needed living expenses by five,” Brandt suggests, highlighting the need for financial stability derived from actual profits, not loans or savings.
Additionally, Brandt stresses the importance of having enough savings outside one’s trading account to cover living expenses for up to two years. This is crucial considering the possibility of losing money in the first year.
“[Novice traders] risk way too much of the $100,000 per trade. Risking more much more than 2% per trade is a recipe for failure. The only solution in my mind is a commitment to a marathon and not a sprint,” Brandt added.
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Brandt also recommends paper trading for at least a year to refine one’s trading approach, focusing on the minute details that often determine success or failure.
Understanding the low success rate among crypto traders is also vital. Only about 3% to 5% of those who try to trade full-time actually succeed, according to Brandt. He challenges traders, saying, “Prove me wrong, and then let me know where I was wrong after two years.”
Brandt also tackles a common misconception in trading. Especially the need for a large starting capital. He argues that success in trading does not correlate with the size of one’s capital. In fact, starting small can help traders quickly identify and rectify mistakes, which is crucial in the steep learning process of trading.
“There is a huge misconception that an aspiring trader needs a big account to be successful. Most “market wizards” would tell you that if you cannot be profitable with a small amt of capital, then you won’t be profitable with more. Actually, with a smaller account mistakes become self apparent sooner. Successful trading occurs when a person climbs a steep wall of learning by making mistakes,” Brandt concluded.
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Brandt’s insights provide a robust framework for crypto traders aiming to make a significant shift in their professional lives, emphasizing that successful trading is about solving problems and learning from mistakes, not just having a strong start.
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