Full Position or Isolated Position? The root of 90% of contract liquidations lies in this step!
You may have heard many times that 'contracts are risky', but what truly leads to liquidation is often not the market being too volatile, but rather that you don't understand the difference between full position and isolated position.
Isolated Position: Clear cards on the table, risk self-control.
For example, if your account has 5000 USDT and you open a position with 500 USDT in an isolated manner, even if the direction is wrong, the loss is limited to that 500 USDT, and the remaining funds are safe. This is suitable for strict risk management, beginners just entering the market, and those looking to navigate high volatility markets steadily.
Full Position: Appears flexible, but is actually 'chronic liquidation'.
A full position treats all the balance in your account as collateral. When you incur losses, the system will automatically draw from the funds in your account to 'extend your life'; if it can't hold on, you'll lose everything! Once you hold onto a position and refuse to cut losses, a full position will directly help you 'go all in'.
Actual Case:
Many brothers who faced liquidation said: I thought I hadn't hit the stop-loss line, how did I lose it all?
In fact, you were using a full position, and you didn't even realize how you perished.
How to choose?
Beginners should prioritize isolated positions: protect capital, control drawdown.
Experts consider full positions: increase flexibility, but must have stop-loss + risk management system.
Remember this phrase: Isolated positions save lives, full positions fight for survival. Whether you can handle it doesn't depend on luck, but on your discipline.
Many people have already boarded this market ride, but only those who understand position management will reach the finish line.
Stop blindly holding onto positions; your account is not a casino. What you need to do is survive to continue winning.
