If you've come across this, have you just been bombarded by your friends' 'doubling in three days' contract performance? Are you feeling pumped listening to group friends calling trades, and you opened leverage with just a finger twitch?

Don’t be too excited yet -

I've seen too many newbies: the first time trading contracts, leverage maxed out; they chase after the market rise, and hold on when it falls; they blame the market for losses and think they are 'geniuses' when making money... In the end, the numbers in their accounts go from 'red' to 'gray', and then to 'zero'.

Today, I won't talk about the myth of getting rich quickly, but the harsh truth: contracts are not a casino, but are more brutal than a casino - you think you are 'betting small to win big', but you are actually confronting human nature, probability, and black swans head-on.

As an old player who has been in the crypto world for seven years, today I will share my 'pitfall avoidance guide' with you. Newbies remember these 5 points, which can at least save you 90% of the detours.

1. First understand the 'essence of contracts', then talk about making money.

Many people rush in without even understanding 'what contracts are' - simply put, contracts are 'borrowing money to bet on price fluctuations': you pay a margin, the platform lends you money to amplify your position (leverage), if it rises, you earn the difference, if it drops and your margin is insufficient, you are forcibly closed out (liquidation).

Key reminder:

· Leverage is not a 'benefit', it is an 'amplifier': with 10x leverage, if you earn 10%, your capital doubles; but if it drops 10%, your capital is directly wiped out.

· Always remember: You are not 'investing', you are 'betting on direction' - if you bet right, you profit; if you bet wrong, you lose, there is no middle path.

2. Newbie's first rule: Don't touch leverage! Don't touch leverage! Don't touch leverage!

(Important things are said three times)

I've seen too many newbies, with a capital of 5000, using 10x leverage, getting excited when the market rises 5%, slapping their thighs; when the market reverses and drops 3%, they hit rock bottom, and their capital goes to zero.

Why can't newbies touch leverage?

· You think you can 'precisely judge rise and fall', but 90% of newbies can’t even understand 'support/resistance levels', let alone predict short-term fluctuations;

· Emotions can hijack your operations: if it rises, you fear missing out and increase your position; if it falls, you are afraid of losing more and hold on, ultimately sliding step by step into the abyss;

· The market specializes in 'disobedience': what you think is 'steady growth' may be smashed by large funds the next second; what you think is 'the bottom' may still have eighteen layers of hell.

3. Position management: always only use 'money you won't regret losing'

The essence of contracts is 'risk games', and position management is the only weapon against risk.

Newbie position rules:

· Capital should not exceed 20% of disposable income (for example, if you earn 10,000 a month, at most take 2,000 to play);

· Do not open a position exceeding 10% of your capital at once (for example, if you have 1000, at most buy 100);

· Always keep more than 50% of 'spare money' - the market won't follow your script, keeping enough bullets is the only way to 'survive to the next round'.

4. Stop-loss is more important than 'doubling': if losing 10%, run immediately, if earning 20%, then add to the position.

The most common mistake newbies make: they can’t bear to cut losses when they are losing, always thinking 'it will come back'; when they make a little profit, they want to 'cash out', and as a result, they miss out on big trends.

Correct operation:

· Set a stop-loss line before opening a position (for example, automatically close if losing 10%) - this is not cowardice, it is 'saving your life';

· After making money, don’t rush to run; use 'trailing stop-loss': when it rises 20%, raise the stop-loss to break-even price, and when it rises 30% more, raise it further to ensure 'the money earned is not easily given back';

· Remember: to recover from a 50% loss, you need a 100% gain; preserving capital is 100 times more important than 'betting on a rebound'.

5. Stay away from 'signal groups' and 'signal teachers': you seek their profits, and they seek your capital.

The easiest pitfall for newbies is being pulled into groups by 'teachers': 'Follow me, guaranteed profits' 'Today I will guide you to harvest the dealer'.

The truth:

· Real experts don’t have time to guide strangers for free online;

· The so-called 'signal calling' is essentially 'the dealer feeding bait' - first let you make a small profit to build trust, then lure you to heavily invest, and finally harvest in one swoop;

· The market does not have 'guaranteed profits', you can only avoid risks as much as possible; there are people who can earn stable profits, but definitely not many, you must keep your eyes wide open.

Lastly, let’s be frank:

Contracts are not a game that ordinary people can master. If you can’t even understand K charts, can’t distinguish between 'spot' and 'contract', and can’t figure out how 'leverage' works - take my advice: first learn the basics, practice with a simulation account, then use small funds for real trading.

Remember:

Slow is fast, steady is winning.

In the contract market, 'staying alive' is 1000 times more important than 'getting rich quick'.

Newbie welfare dry goods:

You must have a rebate when trading contracts. Later you will find that transaction fees are a significant expense on your contract journey, even more important than your profits. How to judge if there’s a rebate? As long as there are trades and no one transfers money to you on time, then there’s no rebate. I can provide the highest rebate ratio within the platform rules, which can save you hundreds or thousands of dollars each month.

Registration invitation code: WEN888 New and old users are welcome, feel free to ask if you don’t understand.

TradingView - Watch K lines, draw trend lines;

Simulation trading (both Binance/OKX have) - practice without losing money.

Remember: Every penny you earn is a realization of your understanding; every penny you lose is a loophole in your understanding.

First supplement your understanding, then talk about making money - this is the 'survival rule' for contract newbies.