Trading is about numbers. The numbers say that 95% of traders lose money and quit trading. The question is why exactly traders lose money so often and why there is no such scaring statistics for hedge funds?
There are no secret strategies or wizards in hedge funds. They are just aiming at long term profitability, as obviously they cannot afford any reputation risks and stupid losses. And the major instrument for hedge funds is to create special conditions for trading that cut losses and allow them to grow capital. And this is a really routine and boring process that requires lots of helpers and an absolutely systemic approach (exactly what the 5% of successful traders do).
Therefore, all the efforts are accumulated to create these conditions that are based mostly on auditors and administrators. These agents work as safety pillow and controller as they do not allow traders, put it simply, do stupid things. Stupidness is too expensive for the funds!
So, the first agent is an auditor. The role of the auditor is to gather and systematize the statistics on trading performance and analyze it to make sure the current performance complies with the strategy developed by a hedge fund. If there are any deviations, the trades are instantly stopped. The statistics for hedge funds is a really powerful control instrument.
The second agent is an administrator. This role deals with current trading performance monitoring. An administrator controls the quality of trading. Administrators monitor it precisely and do prevent any actions that might result in losses. They pay attention to overall drawdown during different periods, the number of losing trades in a row, levels of stop losses and other risks, and stop trading in case if the limits set in advance are exceeded or anything else is going wrong.
It’s easy to conclude that traders in hedge funds act in a strictly limited and controlled environment. It may sound extremely boring, but who cares when this brings billions of profits in the long term.
How to earn money like a hedge fund with Bitinsure?
The insight for you is to trade like a hedge fund as well (boringly). Even though many single traders hardly ever could afford a personal auditor or administrator, they can easily replace them with professional software. And here Bitinsure can be quite useful. It ensures the necessary conditions for your profitability by hedge funds principles. Its major features are automated statistics and risk monitor.
The automated statistics is your auditor.
Track to get valuable insights
It is your personal trading reporting. It automatically records all your actions and results and presents them in a convenient way, you can track and analyze your performance. Even if you are already earning you can multiply the profits by maximizing your strengths! The real-time stats is an essential source of information!
Besides, it calculated the key performance indicators that help assess your trading in a more well-rounded way. Read more about stats and performance indicators here. Thus, you can evaluate your trades with widely-used by professional players: maximum drawdown, profit factor, win-loss ratio.
Still don’t have enough understanding how stats can improve trading that much? Then read some use cases of leveraging automated stats for trading success!
- Multiply the deposit via self-awareness (1)
- Multiply the deposit with the statistics analysis (2)
- Multiply the deposit with strategy optimization (3)
Be swift, save your time
Secondly, even if you are already writing down your stats manually, the software will save your personal time by automated statistics. No more time-consuming routine or human mistakes. You spend your time more effectively with online trading journal.
Prove performance to earn more
Thirdly, if you are an experienced trader, have you ever thought to take money under management? In this case, you will get more profits and also such rewards as a management fee. But what will you show to your clients to prove you are exactly the one to give the money to? Right, the advanced statistical report.
The automated risk monitor is your administrator.
Build a trading system for stable profitability
Have you ever set the limits for losses? Not a simple stop-loss, but, for example, an overall drawdown limit, limit for a day, a week? All these limits are used in hedge funds by administrators to prevent losses (they simply stop traders when the limit is exceeded) and build an effective trading system. By the way, the absence of a risk management system often leads to destructive losses that become a reason for 95% of traders. On the flip side, a reliable risk management system can make you stay in-game even in the case of 100 losses in a row.
Do the same with Bitinsure! Set all the limits in advance once and get a real-time alert since the limit is reached.
Relax
We all are human. We can forget to set a stop loss, we may get too emotional in trading, we might get interrupted while trading, in any case, Bitinsure tells us when any of the limits are exceeded. Afford yourself to be a human without trading losses!
Besides, even if you use trading bots, remember that they one day become ineffective. It can happen due to changed market state, technical error or other bots that work swifter in the market. That is why to stay in control it is recommended to automate risk management.
Be sure you are insured.
Also, remember about technical issues that influence the price or sudden bad news? We cannot predict it and doomedly lose money. In some cases, it’s even recommended not to trade! But all this can be captured by Bitinsure to make us aware and to act timely.
This way, with Bitinsure you are putting the huge scope of work conducted in hedge funds into one visual space and see your trading accounts are getting fit! Trade in a smart way and multiply your profits!
The instructions on Bitinsure are here.
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