2026-01-05 11:22:41

Having traded derivatives for so many years, I've seen too many people rush in only to retreat in disgrace. Some have made several times their investment, while I have personally experienced the despair of liquidation. But through gradual exploration, I’ve come to realize a very simple truth: liquidation is not really due to bad luck, but because risk control was simply not well managed.

In these eight years, I’ve seen too many people chasing high returns recklessly, completely ignoring risk management. Almost without exception, they all ended up losing everything. So today, I want to share a few experiences I’ve gained through real money, hoping to help people re-understand derivatives trading.

**Key Point 1: Leverage itself is not a trap; position size is the real test**

Many people get nervous when they see the term 100x leverage, but honestly, high leverage isn’t as scary as it seems. For example, if you trade with 100x leverage but only invest 1% of your capital, the actual risk is similar to buying spot with all your cash, with a 1% risk.

The core formula is simple: your real risk = leverage multiple × actual position size ratio.

My personal rule is: no matter how high the leverage, I always keep the risk of a single trade below 2% of my total funds. What’s the benefit of this? Even if I make a wrong call on this trade, my account won’t be wiped out. Many experienced traders understand this principle: market opportunities are eternal. If one trade doesn’t work out, we wait for the next. But if the principal is gone, the game is truly over.

**Key Point 2: Stop-loss is a safety rope tied to yourself, not a sign of weakness**

During the big market drop last year, I observed a phenomenon: about 80% of those liquidated had a common pattern — they lost 5% but refused to stop loss, constantly hoping the market would rebound. This is the dark side of human nature: unwilling to admit they were wrong, fantasizing that a miracle will happen.

Anyone experienced in this field knows that stop-loss is not a sign of surrender, but an insurance for your account. My rule is to set a stop-loss point in advance, and once triggered, it must be executed. The worst-case scenario is just a small loss this time, and then I wait calmly for the next opportunity.

The market is always there, time is always available, but once the principal is wiped out, it’s all over. This is not conservatism; it’s using the smallest cost to buy the right to survive.

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blocksnark

· 01-08 10:29

Basically, it's about controlling your position size, setting proper stop-losses, and not being greedy. We all understand the principles, but execution is the hard part.

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GasOptimizer

· 01-08 04:21

Girl, a 2% stop loss has saved me several times. Not using a stop loss is just a gambler's mentality.

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SelfCustodyBro

· 01-06 20:33

Forget it, it's a common topic, but it is indeed the truth. I've seen too many people not believe in evil and end up losing everything. --- The 2% stop-loss rule has really saved me several times. Now I'm used to it, and losing money doesn't even hurt anymore. --- I've also resisted the temptation of 100x leverage. Now using just 1x leverage, my sleep quality has improved. Losing money doesn't matter anymore, haha. --- To be honest, 90% of margin calls happen because people are unwilling to cut losses. I've seen too many cases myself. --- Risk management is truly the ceiling of this industry, no doubt. If you can't do it well, even if you see the right direction, it's all in vain.

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AirdropCollector

· 01-05 11:49

This set of statements is correct, but most people refuse to listen and have to experience it themselves to understand.

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AltcoinMarathoner

· 01-05 11:47

ngl, this is basically the ultra-marathon of trading... mile 20 hits different when you realize it's not about sprinting with 100x, it's about actually finishing the race. been saying this forever – position sizing is everything, rest is just noise.

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FOMOSapien

· 01-05 11:44

Really, I've been using a 2% stop-loss for three years, and I've survived all because of this. --- 100x leverage is not a problem; the problem is that those leverage enthusiasts simply can't control their hands. --- Most people get wiped out because they don't set a stop-loss. If you lack psychological resilience, don't touch contracts. --- I've seen too many people fantasize about miracles, only to have their accounts wiped out. This isn't conservatism; it's survival. --- It's that simple: risk management = survival management, nothing else. --- In that big drop, I saw that 80% of the people got liquidated betting on a rebound. Winning once makes them think they're a genius; losing once means it's all gone. --- Position management is a hundred times more important than choosing coins. If you don't get this, you'll eventually have to pay tuition. --- Leverage is just a tool. Skilled users can comfortably use 100x; those who don't know how will get wrecked even with 3x. --- Stop-loss is not surrender; it's negotiating with the market, not gambling life and death.

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DefiVeteran

· 01-05 11:39

Really, after eight years, these are the only two fundamentals: stop-loss and position management. Everything else is nonsense. I've seen too many people not believe in this approach, only to regret it after going back to zero—it's too late. Leverage isn't actually a problem; the issue is human nature being too greedy. The 2% rule can really help you survive until the end. For those who get liquidated, eight out of ten just refuse to cut losses, stubbornly turning small losses into a complete wipeout. Why bother? You're absolutely right. Losing the principal means everything is over. Admitting defeat and cutting losses is the real smart move. This risk management philosophy should have been popularized long ago, but some people refuse to listen and have to learn the hard way through bloodshed.

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SchroedingersFrontrun

· 01-05 11:38

That's so right, I've also been sticking to the 2% line all along. --- Executing stop-loss really should become a reflex like brushing your teeth; otherwise, once your mindset collapses, everything is gone. --- It's really just about treating luck as chance and risk control as inevitability. --- I've seen too many people go all-in and make 100x, then get wiped out in a bad market, honestly I don't understand this move. --- Leverage, you see, is an accelerator when used well, but a time bomb when used poorly. There's really nothing mysterious about it. --- I feel that nine out of ten people who get liquidated are holding onto a lucky mentality, just hoping the market will save them, but the longer they wait, the worse it gets. --- I've heard the 2% risk rule many times, but very few actually follow it, including myself. --- The most important thing is that the principal stays alive; making more or less is a matter for later. --- Those who don't set stop-losses are basically gambling, and they're betting on the worst odds. --- I actually think this article isn't very innovative; it's just the old talk about risk management, but some people do need to be awakened.

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