Lessons learned from my first 3 months of futures trading
1️⃣ Small capital, big discipline
You don't need a large capital to be a successful trader. If you are not consistently able to grow your small capital, then your chances of succeeding even with a large capital are slim. Focus on strategy over capital.
2️⃣ Bigger margin = more pressure
The higher the margin, the more your decisions will be based on fear. For example:
You and I both take long positions with 10x leverage.
My margin: $30 → Position size: $300
Your margin: $200 → Position size: $2,000
If I go down $3, you go down $20. If I lose $15, you'll be losing $100.
Although our margin ratio (50%) is the same, the pressure will be greater for you because the larger loss amount feels more mentally burdensome.
3️⃣ Diversification and risk management are essential
Never invest all your capital in one trade. Instead, divide your capital wisely:
If you have 200 USDT and are willing to risk 30 USDT, divide it into 4 trades.
Place a stop loss of 15-20 USDT on each trade.
If the stop loss is hit in two trades, there will be a loss of 30-40 USDT, but if the two trades take profit at 30% ROI, the loss will be covered or in profit.
If no trade hits the stop loss, some trades will close at a loss but overall you will remain in profit.
❗ Which trade has the highest losses?
The truth is that most of our trades are successful. The problem is that we often put both our original investment and profits into the next trade.
The result?
One wrong trade wipes out all our previous profits.
That's why risk management is essential, so that even if losses occur, they don't wipe out weeks of hard work.
Futures trading is a marathon, not a race! More lessons coming soon.
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