How much leverage is reasonable for contracts? Someone asked me yesterday, and today I will analyze it for you.

First, what is a perpetual contract? Simply put, as long as you don't get liquidated or actively close the position, you can hold this contract indefinitely. It doesn't have a delivery date like futures, which is the biggest difference.

Yesterday, a friend in crypto asked me, he usually uses 30x or 50x leverage, and wanted to know my opinion.

I told him: If you're going to play, go for 100x! Why do I say this? Here are a few in-depth analyses:

1. The relationship between leverage and risk

The higher the leverage, the more both profits and losses are magnified. Low leverage has small risks but limited returns; high leverage has greater risks, but the speed of profit far exceeds that of low leverage.

The key is risk control, not blindly pursuing the 'sense of security' that comes with low leverage.

2. Liquidation is not frightening; what is frightening is the mindset of liquidation

Many people use high leverage recklessly without discipline to set stop-losses, and their mentality collapses after liquidation.

Real experts use high leverage to 'stably explode', controlling their positions and stop-losses to make liquidation a 'low probability event'. With 100x leverage, as long as it's paired with strict risk management, it is actually an efficient use of capital.

3. Market volatility determines leverage usage strategy

Perpetual contracts do not have a delivery date, making holding time more flexible. When the market confirms and the trend is clear, 100x leverage can quickly magnify returns. Reduce trading during volatile periods to avoid being washed out.

So, how to use 100x leverage reasonably? Three steps:

Step 1: Position control, do not exceed 1%-3% of the account in a single trade to avoid full exposure risks.

Set stop-losses strictly, keeping losses within a bearable range.

Step 2: Enter at the right time, choose clear trend breakout points, focus on trends at the 4-hour level and above, avoid choppy markets and false breakouts, and decisively enter after confirming signals.

Step 3: Strictly set stop-losses, lock in profits in a timely manner, take profits in batches when reaching target points to avoid being devoured by pullbacks, convert profits into funds for subsequent operations, and roll the account size.

Conclusion:

100x leverage is not a monster, but a tool for experts to amplify profits. The key lies in discipline, position, and timing. If used correctly, doubling your capital is no longer a dream.

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