Why do so many people in the crypto world love to trade contracts? To put it simply, it's for quick profits!
For those who love to gamble, contracts are as exciting as online gambling. You might work hard for a month to earn ten thousand, while someone in the contract market leverages that ten thousand at a thousand times. Just a one-point increase can earn you ten thousand; what if it goes up ten points? That’s a hundred thousand, earning you a year's salary in just a few minutes! Who can resist such temptation?
Of course, some will say, what if the direction is wrong and you lose everything? At this time, you need to think in reverse; that person can lose nine times on a hundred thousand, but as long as they are right once, they make a profit. In the crypto world, extreme market conditions can see fluctuations of 1-2% in just one second. If you're lucky, you can earn a month's salary in just one second!
This is why so many people like to trade contracts in the crypto world, all hoping to get rich quickly. In this impatient society, most people are unwilling to slowly grow rich; they prefer to take high risks and gamble.
However, there are also some who are more stable, using large positions with small leverage. Although the returns won’t be as high as those of gamblers, 7-8 out of every ten trades are profitable.
That being said, the contract market is not a joke; liquidation happens frequently. In the past month, liquidated funds in the crypto contract market reached as high as 20 billion dollars! This is not a small amount, indicating that whether with small or large funds, one must be very cautious in the contract market.
So, how can one avoid liquidation in the contract market? The key lies in position management!
Liquidation in contracts often occurs due to excessive leverage and full position trading. Therefore, when trading contracts, one must control their positions and leverage well. When leverage is high, the position must be very low to ensure the safety of one's funds.
Remember, no matter how the market fluctuates, we must protect our position safety. The market will always create waves at some moment, but the safest strategy is to place yourself in a solid fortress. You can occasionally stick your head out to feel the pulse of the market, but you must never expose yourself to the front line of risk.
So, the only secret to trading contracts is position management!
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