Futures trading can grow your capital faster than anything else - or shrink it just as quickly. Smart traders know that risk management is the real strategy.

Why Risk Management Matters

→ Leverage multiplies gains
→ Leverage also multiplies mistakes
→ Without rules, a small loss becomes a tragic story

Stop Losses

Your emergency exit door
✔ Define before entering a trade
✔ Place beyond normal volatility
✔ Never remove it out of “hope”
If the stop hits: accept, learn, move on. The market is never wrong.

Position Sizing

One trade should not ruin the account
✔ Risk 1–2% of capital per trade
✔ Avoid using full margin just because the platform allows it
Bad example
1 wrong overleveraged trade = account gone
Good example
10 wrong well-managed trades = account survives

Survival = success

Diversification

“Do not marry one asset”
✔ Mix indices, commodities, currencies
✔ Reduce exposure to a single event
✔ Understand correlations
Example
Crude oil and Nifty react differently to global shocks

Protection through variety

Daily MTM Awareness

→ Futures settle profit and loss every day
→ Margin can drop fast during volatility
→ Margin call means “add funds or exit”

Track your positions like they are pets they misbehave when unattended.

Simple Risk Rules

✔ Always use stop loss
✔ Smaller size in higher volatility
✔ Do not trade when emotional
✔ Avoid revenge trading
✔ Capital protection > thrill

Quick Pre-Trade Checklist

Ask
→ Is my risk defined
→ Is size reasonable
→ Is leverage under control
→ Is the trade logical
→ Am I calm

If any answer is no skip the trade. Markets are full of temptations.

Final Thought

Winning in futures is not about predicting every move
It is about protecting capital long enough for your strategy to shine

Stay in the game. That is the real edge.