After 18 liquidations, I realized

Liquidation is never the market's fault; it's you who planted the time bomb!

Contract trading is not gambling with your life; it's a mathematical game!

After 18 liquidations and losing 300,000 USDT, I finally grasped the essence of trading—

Leverage is not the original sin; position is the real culprit of liquidation!

Today, I will break down the low-risk rules of a ten-year trader, which will directly overturn your understanding!

1. Leverage ≠ Risk: Position is the lifeline​

Using 100x leverage with 1% position has the same actual risk as holding 1% in spot trading!

My students use 20x leverage to trade ETH, investing only 3% of their capital each time, with zero liquidations in four years. Remember the formula: Real Risk = Leverage Multiplier × Position Ratio.​

2. Stop Loss ≠ Loss: The life-saving symbol of the account​

During the 312 crash in 2024, 82% of liquidated accounts made the same mistake: holding on after losses exceeded 6%.

The iron rule of veteran traders: A single loss must never exceed 3% of the principal, which is equivalent to installing a "shock protection switch" for the account.​

3. Rolling Position ≠ All-In: The correct way to compound​

Laddered position building: Start with 10% to test the waters, then add 15% of profits to the position.

For a capital of 50,000, first invest 5,000 (10x leverage); each time you earn 10%, use 750 to add to the position.

Last year, when BTC rose from 70,000 to 84,000, some people used this trick to increase their safety margin by 40%.​

Risk control formula used by institutions​

Total Position ≤ (Principal × 3%) ÷ (Stop Loss Margin × Leverage)​

For example, with 50,000 principal, 3% stop loss + 10x leverage, you can invest a maximum of 7,500. ​

Three-phase take profit is even harsher: Take 1/3 profit at 20%, take another 1/3 at 50%, and run immediately if the price breaks the 5-day line.

Last year's halving market saw someone turn 50,000 into 1,100,000 using this trick. ​

Warning of a deadly trap: Holding a position for over 3 hours raises the liquidation probability to 94%; trading more than 300 times a month can evaporate 28% of your principal!​

The ultimate rule can be summed up in four words: Control Losses, Wait for Trends. Use 3% risk to fight for trend dividends, allowing discipline to replace impulse, only then can one survive in the contract market. ​

Letting discipline replace emotions is the key to continuous profit!

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