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By the end of this lesson you’ll have a method: a size you could lose outright, the events that would change your plan, one mechanical habit, a default for a price urge, a journal that tells you the truth, and a test to run at night.
A collage of a tall stack of striped mattresses in a dark bedroom, leaning steeply over a huge deep blue boulder at its foot. A tiny man in striped pajamas sits cross-legged on top, wide awake, with a moonlit window torn into the wall behind him.

Start with the loss

Both the UK’s Financial Conduct Authority and the Central Bank of Ireland ask the same first question, and A Portfolio Built to Last lesson 1 took them at their word: can you afford to lose all of it? That sum, written as money and never as a share of anything, is the first decision and the biggest.

Lesson 2 of that course shows why: how much you put in does more than your choice of coin to settle whether you get hurt.

Take what you hold in crypto, or mean to, and work out what a 75 percent fall would take from you, because lesson 2 of this course shows bitcoin falling that far twice since 2017.

Before the fall$1,000
Lost in a 75 percent fall$750
Left after it$250
A made-up $1,000, to show the arithmetic.

Set the amount lost, $750 here, against the sum you could lose. Whether what you hold still fits is your decision.

Seventy-five percent is no floor. Ether fell 94 percent in 2018 and smaller coins have gone to zero, so the sum you could lose has to cover all of it.

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