Tony Crypto Exchange-Contract Newbie Village-Some things you must know before trading

When many people operate cryptocurrency contracts, they often only see his high rewards, but often ignore the risks behind it, causing many newbies to suffer losses in this place. I hope to give some relevant knowledge and reference here. Let everyone understand these before operating the contract. For beginners, I would recommend operating the U-based contract, and then study other parts after slowly operating and understanding.

1. What is a contract

Perpetual contract is a special futures transaction in the cryptocurrency world. It has no delivery date. Unless the position is liquidated or closed, the contract will exist forever.

For long-term contracts, the contract rate must be paid. The funding rate is generated to prevent the excessive premium of the perpetual contract from being decoupled from the spot price. When the long-selling ratio in the market is greater than the short-selling ratio, an interest must be paid to short-selling users. , and vice versa, while the Binance funding rate is charged every eight hours. Every exchange has such regulations. Before opening a contract, you must understand this part, because it will also be one of your long-term contract costs.

2. Take Profit and Stop Loss

Binance Futures Take Profit and Stop Loss Function Introduction and Instructions

The above link can be used for reference. The teaching in it is very complete. I will only remind a few important things here.

When setting the ratio or price of stop loss and profit, be sure to calculate the risk-reward ratio (ratio of risk to reward). The success rate of 1:1 is the highest, but it is not arbitrarily set, but after your analysis The result obtained, for example, when you are analyzing, there must be a price you expect to reach. At this time, this price is calculated with your opening price. After obtaining his ratio, at the stop loss price, You can refer to the same ratio to obtain the stop loss price. In this way, this is a plan with a risk ratio of 1:1.

But this is not absolute, but for beginners, this is the easiest way to plan. When you know more and more knowledge, you can also calculate the profit and loss ratio, so as to set a reasonable take profit and stop loss price.

For beginners, I have a little advice, if you really don't know how to do it, you actually set a minimum loss that you can accept. The timing of taking profit is often when you have an idea that you should be able to more, usually it is a time to close the position, because at that time, you already have the idea of greed, and often, greed is your biggest enemies, bring you losses.

1. Notes for beginners when opening a contract:
2. choose isolated margin
3. The leverage ratio should not exceed 20 times
4. Stop loss should be set
5. Pay attention to your contract status at any time. When you can't see it, it is recommended to close the position.

Be sure to do research, not random positions. An unthought-out list is like gambling. Only by strictly managing your losses can you accumulate wealth.

PS: Many exchanges have related simulated gold. It is recommended for beginners to make more use of simulated gold trading, and do research and practice first.