Trading Type Introduction Why Do Contracts Always Get Liquidated?

It's not bad luck; you simply don't understand the essence of trading! This article, which condenses ten years of trading experience into low-risk rules, will completely overturn your understanding of contract trading — liquidation is never the market's fault, but a time bomb you planted yourself.

Three Major Truths to Overturn Perceptions

Leverage ≠ Risk: Position Size is the Lifeline

Using 1% position size with 100x leverage, the actual risk is only equivalent to 1% of a full position in spot trading. A certain student operated ETH with 20x leverage, investing only 2% of the principal each time, with three years of no liquidation records. Core formula: Real Risk = Leverage Factor × Position Ratio.

Stop Loss ≠ Loss: The Ultimate Insurance for Accounts

During the 2024 March 12 Crash, 78% of liquidated accounts shared a common characteristic: losses exceeding 5% without setting stop losses. Professional traders' iron rule: single losses should not exceed 2% of the principal, equivalent to setting a "circuit fuse" for the account.

Rolling Position ≠ All-In: The Correct Way to Compound

Stepwise Position Building Model: First position 10% trial, increase position by 10% of profits. With a principal of 50,000, the first position is 5,000 (10x leverage), adding 500 for every 10% profit. When BTC rises from 75,000 to 82,500, the total position only expands by 10%, but the safety margin increases by 30%.