In contract trading, liquidation is like a nightmare, especially for new investors. Due to improper risk control, a small mistake can lead to dire consequences. Some investors, ignoring risks, frequently face liquidation until their principal is depleted, which is disheartening. So, how can one prevent liquidation in contract trading?

Firstly, manage positions rationally. The key to trading profits lies in compound interest accumulation, not in seeking quick profits. The compound interest model varies from person to person and needs to be explored through practice. Remember this saying: "Start with light positions, operate with the trend; accumulate bit by bit, and a tower of sand is built."

Secondly, always have stop-losses in place. The stop-loss level should be flexibly adjusted according to the position and trading cycle. In medium-term trades, the stop-loss can be moderately widened to around 2000 points; for short-term trades, it should be controlled within about 500 points. Divide the funds into three parts: one part for trial trades, and two parts for timely scaling up. Operate with small funds for short-term trades, avoiding holding positions blindly, while also considering technical stop-losses and financial stop-losses.

Thirdly, avoid frequent trading. If there are three consecutive mistakes, it is essential to pause trading and change your mindset. You can study interviews and biographies of trading masters, and after your mindset has stabilized and frustration dissipated, review your charts and analyze the root causes of your mistakes, starting with small trial trades. If it’s still not going well, continue to adjust your strategy.

Fourthly, only by following the trend can one endure long-term. The market is unpredictable, and the short squeeze against long positions often causes investors to lose everything. The reason lies in stubbornness, increasing positions against the trend, and fantasizing about price reversals. Little do they know, the market is ever-changing, and only those who adapt to the trend and respond flexibly can survive. Investors must continuously learn and practice, enhancing their technical analysis and psychological qualities, striving for unity of knowledge and action.

Fifthly, never follow the crowd blindly. Before placing an order, analyze others' operational logic carefully, explore the basis for long and short positions, and compare it with your own judgment. If you find it contradicts market trends, do not follow blindly and should decisively withdraw.

In summary, risk and reward coexist in contract trading. Investors must adhere to their own opinions, follow the trend, and adapt flexibly to stay away from liquidation risks and control the trading situation.