8 Years of Contract Warfare: The Truth About Account Burning and the Road to Risk Management

Leverage is not scary – what’s scary is entering trades without managing risk. I have been trading futures for eight years. I’ve blown accounts, doubled or tripled my capital, and I’ve witnessed countless people come and go from the market silently. After all these years, I’ve drawn a very simple but extremely important conclusion: Account blowouts are almost never due to bad luck, but due to failed risk management. Most new traders are swept up in the illusion of quick profits: following trends, catching bottoms, going all-in, using high leverage… But the market does not reward recklessness; it punishes it very mercilessly. 👉 This article is not about “super trades,” but about survival principles, paid for with real money, real mistakes – to help you stay in the futures market long enough.

1. Leverage Is Not the Issue – Position Size Is What Kills You Many people panic when they hear 50x – 100x leverage, thinking it’s “suicide.” In reality, leverage is just a tool; it’s not the cause of account blowouts. For example: You use 100x leverage but only risk 1% of your total capital → your actual risk is no different from buying spot with 1% of your capital. The core formula to remember: Real Risk = Leverage × Position Size Percentage My personal rule over many years: Each trade only risks a maximum of 2% of total assets.
   It’s okay to be wrong, but wrong without dying. Professional traders understand very well: Market opportunities are infinite, but your capital is not.
2. Stop-Losses Are a Safety Net, Not an Admission of Failure During the severe market crash of 2024, I noticed a very frightening number: Nearly 80% of blown accounts had previously lost 5% but didn’t cut. This is not a technical issue – it’s a psychological one: Not wanting to admit you’re wrong
   Hoping the market will “turn around and save you” But the truth is: Cutting losses is not losing – it’s buying insurance for your account. My ironclad rule: Never let a trade lose more than 2% of your capital.
   Even if you lose five consecutive trades, you still have over 90% of your capital to start again. Effective Ways to Set Stop-Losses: Fixed percentage stop-loss
   Technical stop-loss below support (1–2%)
   Maximum allowable loss based on dollar amount Most importantly, it’s not about the method but whether you follow it.
3. Calculate Position Size Before Entering a Trade Position management is the soul of futures trading. The formula I often use: Maximum Trade Amount ≤ (Total Capital × 2%) ÷ (Stop-Loss Margin × Leverage) Real Example: Capital: $50,000
   Allowed risk: 2% = $1,000
   Leverage: 10x
   Stop-loss: 5%
   → Maximum trade size = (50,000 × 2%) ÷ (5% × 10) = $2,000 Thus: Even if the market moves completely against you,
   your account only loses 2%.
4. Take Profits in Small Portions – Greed Is the Number One Enemy Many traders cut losses quickly but don’t take profits, ending up with profits turned into losses. My strategy: Take 1/3 of the position at 20% profit
   Take another 1/3 at 50% profit
   Leave the rest to trail stop (for example, exit everything if it breaks MA5) This approach helps: Lock in partial profits
   Maintain the opportunity to catch the full big trend I’ve seen a trader firsthand: From 50,000 USDT to over 1,000,000 USDT,
   not because they guessed every move right, but because of disciplined profit-taking and strict stop-losses.
5. Use Small Capital to Buy “Big Insurance” When holding large positions, I always allocate about 1% of capital to: Buy Put Options
   Or open offsetting positions to hedge risk During the unexpected crash of 2024: This strategy helped me preserve over 23% of my account,
   while many others… lost everything. In the highly volatile crypto market: Insurance thinking can save your life. The Mathematical Nature of Trading Trade results are not based on emotions but on probabilities: (Win Rate × Average Profit) – (Loss Rate × Average Loss) If: Each trade only loses 2%
   Average win is 6%
   Even with a win rate of only 34%
   → In the long run, you still make a profit. This is the key difference between: Professional traders: rely on systems
   Amateur players: rely on gut feeling Four Ironclad Rules I Always Follow After eight years, I’ve kept only four rules: Never lose more than 2% per trade
   No more than 20 trades per year – quality over quantity
   Minimum expected profit at least 3 times the risk
   Stay out 70% of the time, only enter when the probability is high Conclusion: Surviving Is the Most Important Skill The market is always unpredictable. But your discipline must not be vague. The principles above: Won’t help you win every trade
   But will prevent you from being eliminated from the game. As long as you have capital – there’s opportunity. Survive first – then think about getting rich. Follow @blogtienso for more practical insights, market analysis, and high-probability entry points. Learning is the most profitable investment in crypto.