Brothers, stop getting dizzy from the toxic soup of 'getting rich from contracts'! I've seen too many people rush into the market with three months' salary, only to be ground down by the market in less than a week—money comes as quickly as lightning in this business, but leaves faster than you can order takeout.
Back then, I took a few classmates from a capital of 30,000 to exit with 40 million, relying not on the luck of 'going all in on a big bet', but on the 5 'life-saving iron rules' I summarized after experiencing two liquidation bloodbaths. My operations at that time looked extreme: splitting 300 units of capital into 10 parts, using only 30 units each time to open high leverage, doubling on a correct point, and directly accepting loss on a wrong bet. Surviving in such high-risk play relied entirely on these few 'red lines' being welded into my operations.
First rule: Be more ruthless with stop-losses than the ruthless; never 'date' the market.
When I first entered the market, I made foolish mistakes too, always thinking 'just a bit more and it'll rebound' as I watched prices fall. The two times I faced liquidation were due to 'stubbornly holding on'. Later, I established a strict rule: once it reaches the preset stop-loss point, I click to close the position faster than a delivery guy snatching an order. You must understand, a stop-loss is not giving up; it's saving your account's 'life'—the market won't turn around just because you're holding on, but your capital can be wiped out if you play dead.
Second rule: If you lose 5 trades, 'fuse' it; don’t stubbornly fight chaotic markets.
The market always has times when 'brains go haywire', and the prices are as chaotic as a pot of porridge. At such times, forcing trades is just giving away money. I set a '5 trade fuse mechanism' for my team: if you make 5 mistakes in a row, no matter how unwilling, immediately shut down the computer and go downstairs to have a bowl of noodles. Interestingly, often when the market opens the next day, it feels as if it has been splashed with cold water and instantly wakes up. At this point, re-entering the market can double your win rate.
Third rule: Take profits when they appear; only the money in hand is real money.
The numbers on your account are just a 'paper game'; until you withdraw them to your bank card, they don't count as your money. I set a rule: every time I earn enough 3000 units of capital, I immediately withdraw half. Don’t think 'waiting a bit can earn more'; the market changes faster than a girlfriend’s mood. You might turn around to take a sip of water and half your profit could evaporate. Taking profits ensures a good night's sleep.
Fourth rule: Follow the trend, be a 'spectator' during volatile markets.
High leverage is an 'accelerator' in a one-way trend, but in a volatile market, it's a 'meat grinder'. I never mess around in unclear market directions; I’d rather sit and have afternoon tea than go in and become 'chopped leeks'. Judging the trend is very simple: check if the recent highs and lows are moving up or down step by step. If it’s like a flatline on an ECG, then let’s just be quiet spectators.
Fifth rule: Strictly control positions; never be a 'gambling warrior'.
Only use 30 units of capital for each operation, and your position should never exceed 10% of the capital. Don't underestimate the power of a light position; it allows you to remain calm during market fluctuations. Think about it: if you're fully invested, even a small fluctuation can make your heart race to 180. At that point, how can you rationally judge the market? A light position is not cowardice; it's the wisdom that helps you 'live longer' in the market.
Last but not least, heartfelt words: Contract trading has never been a shortcut to 'getting rich overnight', but rather a 'war of endurance' to see who has more patience. There are many opportunities in this market, but even more traps. Engraving these 5 iron rules in your mind is 100 times more reliable than holding a 'gamble' mentality.
I share my practical insights and market judgments here every week because it's better to enjoy together than alone. Follow me, and next time we'll talk about 'how to quickly identify trend reversal signals'—after all, in the market, those who know how to navigate won’t stumble. See you in the comments, let’s see what contract pitfalls you all have encountered~
