How to increase more revenue in cryptocurrency margin leverage trading?
Bitcoin and many other cryptocurrencies are popular for the volatility because that sees their prices fluctuate like substantially in a small duration of time. If you’d stepup cryptocurrency world and make your market into the business opportunity to make a profit, you may prefer leverage trading or margin trading.
What is margin or leverage trading?
Leverage is nothing but it is essentially borrowed funds that increase a trader’s position size and its market exposure, thus its profitability.
Sometimes referred leverage trading is known as margin trading (the two are often used interchangeably), leverage trading involves borrowing funds to amplify potential returns when buying and selling bitcoin and any cryptocurrencies. When you are in cryptocurrency leverage trade, you can access increased buying power of cryptocurrencies and may open positions that are much larger than your actual account balance.
How does margin trading works?
The term ‘leverage’ refers to how much the position was increased by, for instance, 100x (or 1:100) leverage will increase a $500 Bitcoin position to be as big and as profitable as a $50,000 Bitcoin position.
Using this same example, a trader’s initial investment ($500) is referred to as the ‘margin’ .
Margin trading can be used to open both long and short positions.
A long position reflects an assumption that the price of the asset will go up, while a short position reflects the opposite. While the margin position is open, the trader’s assets act as collateral for the borrowed funds. This is critical for traders to understand, as most brokerages reserve the right to force the sale of these assets in case the market moves against their position (above or below a certain threshold).
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