Today, let's talk about the pitfalls of contract trading. $BTC
In contract trading, many people only focus on price fluctuations, but overlook the real rules of the game.
Recently, a friend complained to me: I got the direction right, held the position for several days, but ended up losing nearly a thousand U due to funding fees, and when I finally closed the position, the market took off... Where did the problem lie?
It's not the market, it's the rules.
Today, let's discuss some of the most common 'invisible pits' in contracts.
First pit: Funding fees - silent harvesting
Funding fees are charged every 8 hours, with positive rates meaning long positions pay short positions, and negative rates meaning short positions pay long positions. Many people get the direction right but lose their principal little by little due to long-term holding and funding fees, and they exit before the market starts.
Suggestion: Avoid periods of continuously high funding rates (e.g., >0.1%), control holding time, and try not to be on the side with unfavorable rates.
Second pit: The liquidation line is closer than you think
Do you think you will get liquidated only when a 10x leverage drops by 10%? In reality, the platform imposes additional liquidation fees, and you might be forced to liquidate after a 5%-6% drop.
Response: Don't fully leverage, make good use of 'isolated margin mode', keep leverage between 3-5 times, and reserve enough margin for a buffer.
Third pit: High leverage is a double-edged sword $XRP
100x leverage sounds exciting, but both transaction fees and funding fees are calculated based on the loan scale. Even if you get the direction right, profits may be swallowed by various fees.
Principle: High leverage is only suitable for ultra-short-term probing; if you really want to hold onto a trend, you must reduce leverage.
Exchanges are not afraid of you losing money; they are afraid of you understanding the rules. To survive in this market, it's not about guessing the direction, but about being clear on the rules and strictly adhering to discipline.
If you also want to avoid these pitfalls and move forward in a more stable way, I can accompany you to see the way clearly. @bit杰哥
