If you decide to enter contract trading, be sure to keep the following points in mind:
Understand the risks and stay calm: Contract trading is essentially about betting small to win big, and losses are common. After a loss, many people impulsively open positions, while others choose a cooling-off period. My advice is: when experiencing frequent losses, pause trading and calmly adjust your strategy.
Avoid quick gains: Contract trading is not a shortcut to overnight wealth. When facing losses, maintain a calm mindset, do not rush to open positions, and definitely do not go all-in with heavy investments.
Follow the trend: The primary key to trading is the overall trend. When the market shows a one-sided movement, you should trade in the direction of the trend, not against it. Trading against the trend often leads to significant losses, regardless of whether you are a novice or an experienced trader; trading against the trend can teach you painful lessons.
Maintain a reasonable leverage ratio: The leverage ratio is the foundation of trading, ensuring that the leverage ratio is at least 2:1 to reasonably open positions and increase trading opportunities.
Avoid frequent trading: Frequent trading is a major taboo in contracts. Especially for novice players, it is easy to act impulsively when facing the market, missing good opportunities. Remember, most so-called "opportunities" may lead to losses.
Only earn money within your understanding: Before you fully understand the market and strategies, stick to trading within your knowledge and avoid excessive expansion.
Do not hold positions blindly: Holding positions in contract trading is a major taboo, especially for novices. Be sure to set stop-losses and execute them promptly to prevent losses from escalating and gradually leading you towards disaster.
Do not be arrogant during winning: Stay calm during winning periods, avoid being overly confident, maintain rationality, and prevent losses due to excessive self-assurance.
Summary: Contract trading is full of risks; calmness, rationality, and following the trend are the keys to success.
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