Learn contracts from scratch! How can a novice become an expert?
To put it bluntly, a contract is two people's different views on the future price of a currency:
One thinks it will rise and wants to buy more; the other thinks it will fall and wants to buy short.
So the two made a bet. Whoever guesses right makes money; whoever guesses wrong loses money.
How to play the contract?
For example, you bought a Bitcoin contract, and the current price of Bitcoin is $30,000. You chose 5x leverage and invested $6,000 to control a $30,000 contract. Next, you have two choices:
Go long: If you think Bitcoin will rise, buy more;
Go short: If you think Bitcoin will fall, buy short.
Profits and losses are directly related to price fluctuations and leverage. For example, if it rises to $32,000, you earn $10,000 ($2,000 × 5x leverage); if it falls to $28,000, you lose $10,000 ($2,000 × 5x leverage). When you think it's almost done, "close the position" (exit the transaction) to lock in profits or stop losses.
Advantages of contracts:
Can magnify profits: Use small money to play big money, and the profits are leveraged. Flexible short selling: You can make money in a bear market, whether it goes up or down. No delivery required: You don't need to actually buy coins, and directly settle profits and losses, which is very convenient!
But the risks of contracts are not small:
Leverage risk: High leverage, quick liquidation, a slight change in the coin price, the account is gone. Large market volatility: The coin circle itself is volatile, and the contract market is more exciting, so you need to be strong enough. Funding rate: Perpetual contracts may have handling fees, and the cost will be high over time. High complexity: Novices may feel a little confused about various rules and strategies.
How do novices play?
Don't be greedy for leverage: Use a small leverage (2-5 times) first, don't go all-in 100 times at the beginning, keep the principal and play a few more times!
Control risks: Use stop-profit and stop-loss to protect yourself, don't always think about "taking another gamble".
Use less "tuition money": only use spare money to try, and even if you lose money, it won't affect your life.
Newbies must take it slow, read more and learn more if you don't understand, don't be cut off as soon as you enter the currency circle!
Now that ETH has pulled back to around 3300, the opportunity to buy the bottom of the cottage is coming soon! I have carefully selected a currency that is expected to increase by 5-10 times for everyone, leave a message + like, and share it for free!
