I've seen too many people get the most excited when they have hundreds of thousands in unrealized gains floating in their account, only to lose their entire principal not long after.

What's even scarier is that this process isn't an instant collapse—the market will actually give you three chances to get out, but every time you'll think, "I'll just wait a little longer."

I know a friend who bottomed into BTC at the end of 2022 with 100,000 yuan, at a cost price of $17,000. By March 2024, BTC soared to $73,000, and his account ballooned to 430,000, with over triple unrealized profit.

At the time, I advised him to at least cash out a portion, but he insisted, "It's only 4x so far, I'm waiting for BTC to hit $100,000!" He didn't move his position at all.

Then in August, the market corrected, BTC fell to $49,000, and his account shrank to 290,000, with more than half of his gains wiped out. He panicked, but still tried to sound confident: "It'll definitely come back up."

In November, the bull market warmed up again, and BTC did break through $100,000, bringing his account back to 590,000. Now he was even more inflated: "Next target, $150,000!" But now? BTC has corrected to $91,000, and his account is back down to 530,000. A couple days ago, he came to ask me, "I clearly called the bull market right, so why didn't I make any real money?"

The problem is pretty clear—

This is the all-in gambler's mentality, with zero concept of position management. Retail investors always focus on "how much can I buy," while veterans calculate "how much should I keep." Look at the institutions—even their so-called full-position operations keep 30% in cash, while retail loves to go all-in, sometimes even using leverage.

I later taught him three survival rules, and I'm sharing them here too:

**Rule 1: The 333 Position Building Method**
Split your bottom buy into three batches, with 1/3 of your funds in each. For example, when I bought the BTC dip in 2022 with a total position of 150,000, I allocated it like this: buy 50,000 at 17,000, add another 50,000 at 16,200 if it drops, and buy the last 50,000 at 17,500 if it rebounds. Average cost came to 16,900, much safer than going all-in at once.

**Rule 2: The 721 Position Holding Rule**
Hold 70% as a long-term core position, use 20% for swing trading to lower your cost, and keep 10% as reserve cash for black swan events. This way, when others are panic-selling in a crash, you still have ammunition to buy.

**Rule 3: The 251 Take-Profit Rule**
When your asset doubles, sell 20% to recover your principal; at 5x, sell 50% to lock in profits; at 10x, cash out completely and secure your gains.

Some people ask: if I only have 10,000 as principal, do I still need to split batches? You need it even more! Small funds can't afford trial and error. If you're already all-in, then do "T" trading to lower your cost: sell 20% when it rises 10%-15%, then buy back after it pulls back, and gradually adjust your position into a 721 structure.

These methods sound simple, but the hard part is resisting greed. Remember this—surviving comes first; only then do you have a chance to make big money.