Recently, the market has been very extreme, so I’ll just share with everyone why contracts often get liquidated.

Check out the total liquidations in contracts! Here’s some practical knowledge! $BTC
Why do contracts always get liquidated? It’s not bad luck; it’s because you simply don’t understand the essence of trading! This article, condensed from ten years of trading experience, presents low-risk rules that will completely overturn your understanding of contract trading — liquidation is never the market’s fault, but a time bomb you personally set.

Three truths that overturn common beliefs
Leverage ≠ Risk: Position size is the life-and-death line $ETH
With 100x leverage using only 1% of your position, the actual risk is only equivalent #比特币 to holding a full position in spot trading. A student used 20x leverage to trade ETH, investing only 2% of their capital each time, with zero liquidations over three years. Core formula: Actual risk = leverage multiple × position ratio.

Stop-loss ≠ Loss: The ultimate insurance for your account $RAVE
During the 2024 March 12 crash, a common feature among 78% of liquidated accounts was: no stop-loss set despite losing over 5%. The professional trader’s iron law: individual losses should not exceed 2% of the principal, effectively setting a "circuit breaker" for the account.

Rolling over ≠ All-in: The correct way to compound profits $SOL
Stepwise position building model: start with 10% of your capital to test, add 10% of profits to increase position. For a 50k yuan principal, initial position is 5,000 yuan (10x leverage), each 10% profit adds 500 yuan. When BTC rises from 75,000 to 82,500, the total position only increases by 10%, but the safety margin improves by 30%.

Institution-level risk control model
Dynamic position formula
Total position ≤ (Principal × 2%) / (Stop-loss range × Leverage)
Example: 50k yuan principal, 2% stop-loss, 10x leverage, maximum position = 50,000 × 0.02 / (0.02 × 10) = 5,000 yuan (

Three-stage take-profit method
① Close 1/3 at 20% profit
② Close another 1/3 at 50% profit
③ Move the remaining stop-loss (exit if breaking the 5-day moving average)
In the 2024 halving market, this strategy increased a 50k yuan principal to over a million through two trend cycles, with a return of over 1900%.
Hedging insurance mechanism
Use 1% of the principal to buy put options during holding, which has been empirically shown to hedge 80% of extreme risks. During the black swan event in April 2024, this strategy successfully saved 23% of account net value.

Data-backed fatal trap evidence
Holding positions for 4 hours: liquidation probability rises to 92%
High-frequency trading: 500 trades per month, losing 24% of principal
Greed for profit: 83% of accounts give back profits due to not taking timely profits

IV. Mathematical expression of the essence of trading
Expected profit = (win rate × average profit) - (loss rate × average loss)
With a 2% stop-loss and 20% take-profit, only a 34% win rate is needed for positive returns. Professional traders achieve annualized returns of over 400% by strictly enforcing an average loss of 1.5% and capturing trends with an average profit of 15%.

Ultimate rules:
Single loss ≤ 2%
Annual trades ≤ 20
Profit-loss ratio ≥ 3:1
70% of the time stay in cash
The market is fundamentally a game of probabilities; smart traders use 2% risk to seize trend dividends.
Remember: controlling losses allows profits to run. Building mechanical trading systems that let discipline replace emotional decisions is the ultimate key to sustained profitability.