This is, without exaggeration, the most important aspect of futures trading.
Start with Low Leverage: Seriously. For beginners, 3x-5x leverage is already high. Avoid 50x or 100x leverage until you have extensive experience and a proven strategy. High leverage means your liquidation price is very close to your entry, making you vulnerable to small market swings.
Always Use Stop-Loss Orders: This is non-negotiable. A stop-loss order automatically closes your position if the price moves against you to a predetermined level, limiting your potential loss. Define your stop-loss before you enter a trade.
Position Sizing: Never risk more than a small percentage (e.g., 1-2%) of your total trading capital on a single trade. If you have $1000 in your futures wallet, don't risk more than $10-$20 per trade. This allows you to withstand a series of losing trades without wiping out your account.
Understand Liquidation: Know how to calculate your potential liquidation price before opening a position. Binance has a calculator for this. Always be aware of how much margin you have available.
Don't Overtrade: Trading too frequently can lead to impulsive decisions, higher transaction fees, and burnout. Focus on high-quality setups rather than constant trading.
Maintain Sufficient Margin: Keep a buffer in your futures wallet. Don't use 100% of your available margin for active trades, as this leaves no room for price fluctuations.