Investing beginners may think that professional traders spend most of their time staring at the screens day and night to analyze the markets and select the best traders, but this is far from the truth.

A good eye is not what separates large traders from ordinary traders, it is the use of proven strategies that enable professional traders to be positive for long periods of time. Today we will discuss how top traders use futures trading, fixed income financing and the use of stop loss points.

Each of these simple strategies does not include private trading robots or large margin deposits, which means that the investor does not need a huge trading balance to make money.

Non-directional strategies
Cryptocurrency markets are known for their low price movement, which involves the rise or fall of many double or triple-digit assets over the course of an hour to 24 hours.

Investors are attracted by the opportunity to generate good returns, so it would be insane to propose aiming for only 2% of the monthly cryptocurrency surplus.

Why should an investor use a “low yield” strategy? The answer is compound interest. If a trader can earn 2% per month, his annual profit is 27%.

Few traders will be able to consistently match these returns by trying to guess market highs and lows. Thus, you eliminate a more reliable profit pressure on potential losses and the almost impossible task of trying to calculate the market.

A great strategy called carry trade is to buy cryptocurrencies in traditional markets and sell futures contracts on a fixed monthly calendar.

This rate can be measured by analyzing the underlying index, also called the annual futures market premium.

This is not a permanent trade, as the primary index fluctuates depending on how high the investors are. As a rule, alternative digital currencies have more opportunities as competition for them decreases.

As you scroll through the chart above, notice how Base Ether (ETH) hit its 20% annual level in mid-August. but it is a problem.

The devil is always in the details, and this is such a case. This trade only works if the cryptocurrency set as a margin is the same as the one sold under futures contracts. Some derivative exchanges allow Bitcoin (BTC) or Tether (USDT) to be deposited as collateral.

An important thing to keep in mind for investors is that unlike permanent futures contracts (reverse swaps), fixed calendar futures contracts have a specific expiration date. Therefore, it is necessary to sell the spot position at the time of termination of the futures contract.

Trade finance rate
Other non-directional trades include option strategies, which usually include multiple expiration periods and futures contracts.

A less risky example is the use and trading of fixed income funds. Standing contracts (reverse swaps) will charge a commission on the purchase or sale of trades depending on the leverage imbalance. These exchanges report the estimate for the next financing window, usually every 8 hours.

When this price rises, professional traders simultaneously buy and sell futures contracts on spot exchanges. Therefore, their risk is fully hedged, they receive a financing interest rate and return the trade immediately.

Automated trading is the key to success
Sometimes there are not many risk-taking trading strategies on the market. In such situations, even professional traders can think about the risk of the trend. What sets them apart from beginners is the use of automated trading.

Most traders know how to use stop loss, and that’s fine, but it does not create winning opportunities. The same tool can be used to open trades, especially if you use a subsequent stop loss.

Binance Futures trading platform. Source: Binance
In the example above, the price of this (long) subsequent stop is $ 12,900. As long as the market continues to trade above this level, this system remains dormant.

When Bitcoin reaches this level, it will only buy after a 0.8% correction (retracement rate). Thus, the purchase will be made automatically as soon as the bitcoin price rises to $ 103 from the low.

This strategy is often used by professional traders to automate the investment process and significantly reduce the need to check prices 24 hours a day.

Source: CoinTelegraph