In contract trading, many people find themselves in trouble due to operational mistakes. Recently, I came across a case: a trader lost all 4000 USDT in a contract position. After reviewing the case, it was found that the main issues stemmed from several fatal errors—going all-in, chasing gains and cutting losses impulsively, and contrarian bottom-fishing—almost stepping into trading forbidden zones.

Such situations are actually quite common. The key is how to recover from losses and establish a scientific trading system. Someone summarized a practical contract opening framework worth referencing:

**Stage-wise Positioning Strategy**

First, allocate only 20% of the total funds for the initial position. The obvious benefit of this approach is reducing the impact of a single decision error. If the judgment is wrong and a 10% loss occurs, stop loss immediately; the actual total fund loss is only 2%.

Conversely, if the market moves as expected? A 10% profit triggers an additional position, adding 20% of the funds. Each subsequent 10% increase in price continues to add 20%, and on the third addition, invest directly with 40%, expanding the winning results. As long as the price does not fall more than 10%, hold the position; once the decline reaches 10%, close all positions to stop loss.

**Core Concept Analysis**

The brilliance of this framework lies in: using small trial-and-error costs to verify the correctness of trading logic, then gradually increasing positions to seize trend opportunities. Risks are minimized, while profits can be exponentially amplified. This approach draws on the classic philosophy of speculator Jesse Livermore—let winners keep winning, and cut losses quickly on failures.

Of course, theory is one thing; in actual execution, market variables are numerous. This method can significantly improve profitability over long-term practice, but it’s not foolproof. Its value lies in systematic risk management, not risk elimination. Many traders become “leeks” (small investors) mainly because they lack methods and discipline.

Trading contracts must adhere to a methodology; blindly going all-in only accelerates losses. This framework can serve as a reference starting point, continuously optimized and iterated in live trading.