Still losing money in contracts? The problem might be simpler than you think.

Many people can make money trading spot, but when it comes to contracts, they end up losing everything. Why is that? Because they haven't understood the basic logic of contract trading. Today, I'll explain the core concepts.

**The Four Forbidden Zones of Contract Trading**

First, never trade without setting take-profit and stop-loss orders. That's how you lose money.

Second, carrying positions is a big taboo. What is carrying a position? It’s continuing to add to a losing position in an attempt to break even, which only deepens the loss.

Third, don’t go all-in with a single bet. Betting more than 5% of your account on one trade is basically gambling mentality.

Fourth, don’t operate blindly. If you don’t understand the key levels, don’t move your positions; if you can’t see the market clearly, it’s time to rest.

**How to Choose Entry Points**

Taking ETH as an example. Suppose you are bullish on the 1650–1700 range for shorting. Then, 1650 can be your "buffer level," and 1700 as your "strategy level."

Enter the first order at 1700. If you don’t make an immediate profit, add a position at 1700, so your average cost becomes 1675. This logic also applies to BTC—an entry price with a 500-point fluctuation corresponds to a front position and a reserve position.

The key is not to rush; entering in batches can better lower your average cost.

**How to Manage Position Size**

This is especially important; it directly determines your survival.

The standard approach is: enter 1% of your position at the predetermined level, then add another 1 at a reserved level. If the order itself provides a rebuy level, then add 2% at that level, totaling 4%.

For orders without rebuy guidance? Enter 2% at the predetermined level and another 2% at the guard level, also totaling 4%.

The hard rule here is: **single position size must never exceed 5%.**

**Two Approaches to Take-Profit**

One is the staggered take-profit method: take half profit at 60%, another half at 80%, and close all at 100%. Then, move the stop-loss to the entry price, using profits to aim for higher gains.

The other is the trailing stop method: when profits exceed 100%, raise the stop-loss slightly; over 200%, raise it again, following the trend to chase orders. This way, you protect profits while riding the trend.

**In summary: Contract trading is not gambling; it’s risk management.** Controlling position size, setting stop-losses, and operating in batches greatly reduce the chance of losing money. Those who go all-in and don’t use stop-losses deserve to lose.