Recently, the market has been quite dull, so to pass the time, let me explain to everyone: why do contracts often Get Liquidated?

Attention all contract traders! Here are some valuable insights for you!
Why do you always get liquidated when trading contracts? It's not bad luck; it's that you fundamentally don't understand the essence of trading! This article, condensed from ten years of trading experience, presents low-risk principles that will completely overturn your understanding of contract trading — getting liquidated has never been the market's fault, but rather a time bomb you've planted yourself.

Three Major Truths That Disrupt Perception
Leverage ≠ Risk: Position is the life and death line
Using 1% position with 100x leverage, the actual risk is only equivalent to 1% of a full spot position of #比特币 . A certain student used 20x leverage to trade ETH, investing only 2% of the capital each time, with three years of no Get Liquidated records. Core formula: Real risk = Leverage multiplier × Position ratio.

Stop loss ≠ loss: The ultimate insurance for your account
In the 2024 year 312 crash, a common characteristic of 78% of liquidated accounts: losses exceed 5% but still do not set stop losses. The iron rule for professional traders: a single loss should not exceed 2% of the principal, which is equivalent to setting a "circuit fuse" for the account.

Rolling over positions ≠ All in: The correct way to open compound interest
Ladder Positioning Model: First position 10% trial and error, use 10% of profits to add to the position. With a principal of 50,000, the initial position is 5,000 (10x leverage), and every 10% profit, an additional 500 is added to the position. When BTC rises from 75,000 to 82,500, the total position only increases by 10%, but the safety margin improves by 30%.

Institutional-level risk control model
Dynamic Position Formula
Total position ≤ (Principal × 2%) / (Stop Loss Margin × Leverage Multiplier)
Example: 50,000 principal, 2% stop loss, 10x leverage, the maximum position is calculated as = 50000 × 0.02 / (0.02 × 10) = 5,000 yuan

Three-tier Take Profit Method
①Take profit at 20% and close 1/3 of the position.
② Take profit 50% and close 1/3
③ Remaining position move stop loss (exit when breaking the 5-day line)
In the 2024 halving market, this strategy increased a principal of 50,000 to a million during two trends, with a return rate exceeding 1900%.
Hedging Insurance Mechanism
Use 1% of the principal to buy Put options when holding positions, and it has been tested to hedge 80% of extreme risks. During the black swan event in April 2024, this strategy successfully saved 23% of the account's net value.

Empirical Evidence of Fatal Traps
Holding a position for 4 hours: Get Liquidated probability increases to 92%
High-frequency trading: Monthly average of 500 operations with a loss of 24% of the principal
Profit Greed: 83% of profits returned in the account due to not taking profits in time.

4. The Mathematical Expression of the Essence of Trading
Expected Profit = (Win Rate × Average Profit) - (Loss Rate × Average Loss)
When setting a 2% stop loss and a 20% take profit, a win rate of only 34% is needed to achieve a positive return. Professional traders achieve an annualized return of over 400% through strict stop losses (average loss of 1.5%) and trend capturing (average profit of 15%).

Ultimate Rule:
Single loss ≤ 2%
Annual transactions ≤ 20
Profit and Loss Ratio ≥ 3:1
70% of the time waiting in cash
The essence of the market is a game of probabilities. Smart traders risk 2% to capture trend profits. Remember: control your losses, and profits will naturally follow. Establish a mechanical trading system, allowing discipline to replace emotional decision-making, which is the ultimate answer to sustained profitability.