Risk Management and Trade Strategies - charlespurrgeon
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Mindset
Trading is one of the most challenging psychological battles you’ll face—it’s you vs. yourself every day. Unfortunately, many misunderstand real trading, thanks to unrealistic expectations set by trading “influencers.”
Reality Check:
Trading is not a get-rich-quick scheme.
Never trade money you can’t afford to lose. If you’re using your last $100 for rent or food, keep it in your bank account.
The Right Mindset: The Hunt
Success with Odin Bot requires falling in love with The Hunt. Instead of focusing on money, focus on:
Hunting for profitable wallets.
Hunting for strong risk-to-reward ratios.
Hunting for discipline to stick with mirrors, even after 3–4 losses in a row.
Shift your focus to questions like:
How can I improve my risk management?
How do I find better wallets?
How do I handle 5–10 consecutive losses?
How can I maximize wins by adding to profitable trades?
Adopting this mindset will not only improve your discipline but will help you build a sustainable, long-term trading strategy.
Risk Management
In trading, risk management is the only true edge. Technical and fundamental analysis are only as useful as the risk you’re willing to take. Indicators, moving averages, and support/resistance levels can fail at any time, especially when market conditions shift unexpectedly.
Why Risk Management Matters
Unpredictability: No one, not even the best traders, can predict the price of a token a second from now.
The 50/50 Reality: Every trade has a 50% chance of hitting your profit target and a 50% chance of hitting your stop loss.
When using Odin Bot, your focus should be on two key factors:
Position Size
Cumulative Win Rate and PNL Size
Position Size
The amount you risk per trade determines your ability to survive losing streaks—this is known as Risk of Ruin.
Example:
Risking 0.1 SOL on a 0.5 SOL account:
You only have 5 chances to win before your account is wiped out.
Risking 1% of your account:
You can survive 100 losing trades before losing everything.
Risking 5% of your account:
You can only survive 20 losing trades.
There’s no strict rule for how much to risk per trade. If you’re comfortable risking 50% of your account on a single trade, that’s your choice—but the goal is survival. Surviving long enough to hit a few big wins can grow your account significantly.
Cumulative Win Rate and PNL Size
The balance between win rate and profit/loss (PNL) size plays a critical role in your success.
Win Rate:
Each wallet has its own win rate. When following multiple wallets, your combined Cumulative Win Rate is an average of all their win rates.
Example:
Follow 10 wallets: 5 with a 67% win rate and 5 with a 50% win rate.
Your average win rate is 58.5%.
Important Note: You will never mirror trades at the exact same time as the wallet. Delays are inevitable, so it’s wise to subtract 10–15% from your Cumulative Win Rate as a safety buffer.
PNL Size:
Win rate alone doesn’t tell the full story—the size of wins and losses matters.
Example 1:
A wallet with a 90% win rate might look great, but if its winners average 2% gains and its losers average 50% losses, it’s not profitable.
Example 2:
A wallet with a 30% win rate may seem poor, but if its winners average 800% gains and its losers average 2% losses, it will be highly profitable over time.
Balancing win rates and PNL size is an essential skill for using Odin effectively.
Final Thoughts
Success with Odin Bot is a balance between embracing The Hunt, managing risk, and fine-tuning win rates and PNL sizes. Focus on the process, stay disciplined, and adapt your strategy to survive and thrive. With time and patience, you’ll build the skills needed to reach Valhalla.
For detailed explanations with examples, visit our official blog:
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