2025-12-29 10:25:30

# Why Do Contracts Always Lead to Liquidation? Do You Really Understand Leverage?

Every day, people lose everything in contracts, yet more rush in afterward. Why? Frankly, most people haven't truly understood how contracts work.

They see platforms advertising 5x, 10x leverage and get excited, thinking they've opened a 5x position. Big mistake.

For example—if your account has 10,000 yuan, theoretically, you can withstand a 500 yuan loss. But what do many do? They immediately open a 30,000 yuan position, comforting themselves with "It's not a big deal." In reality? You're already playing with 60x leverage, and liquidation is just around the corner.

Experienced traders see clearly: this isn't gambling; it's risk hedging. The profits in your pocket, to put it bluntly, are leftovers from others' liquidations. The market is always transferring wealth—someone's stop-loss point is another's take-profit point.

How do professional traders operate? 70% of the time, they wait. Wait for the market to truly reach the right level. If it hasn't, they stay put. When they act, it's with a clear goal—to precisely harvest profits.

Want to survive and make money in contracts? You need to learn to go against human nature: when others are panicking and rolling on the ground, stay calm; when others are envious and greedy, stay calm.

The rules are harsh but simple—stop-loss must be an ironclad rule, with a single-loss limit of no more than 5%; when you make money, close the position decisively. The bottom line is that profit should be at least twice the loss.

Many say contracts are full of traps. I don't think so. The trap isn't the contract itself; it's your heart—one that can't handle losing, lacks a plan, and relies on feelings.

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GateUser-bd883c58

· 6h ago

To be honest, most of the guys who get liquidated simply don't understand the meaning of leverage, thinking that the multiple is just a multiple, and end up playing with 60x leverage. They lose big. You need to learn to cut losses; otherwise, you're just giving money to others. Truly profitable traders are all waiting, waiting for the right market conditions before taking action, not just gambling every day. Contracts themselves are not problematic; it's human weakness that causes issues.

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just_here_for_vibes

· 6h ago

You're right, most people are truly destined to be cut by leverage and end up as chives, yet they still feel good about themselves. --- That's why I never touch contracts; seeing so many people get liquidated makes me realize I'm not cut out for this. --- The difficulty lies in execution. Those who know they should cut losses often die from greed. --- For professional traders, 70% of the waiting time is spent doing nothing. Most people simply can't sit still and need to trade every day to feel comfortable. --- In the end, it's a mindset issue; technical skills are secondary. --- Hedging risks sounds sophisticated, but it's really just conservative operation. But who can truly do it? --- Using a 30,000 position with a 10,000 account is definitely playing with fire. You can't even figure out basic math when it comes to trading contracts.

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SneakyFlashloan

· 6h ago

Playing with 60x leverage, haha, this is what most people I see are like... really just like gamblers, knowing the risks but still going for it.

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zkProofInThePudding

· 6h ago

Really, this is the gambler's mentality. Just looking at the example of 60x leverage makes me laugh. How many people play like this every day?

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WinterWarmthCat