Crypto margin trading

[BitcryptoHan 2557]

In fiat or forex margin trading, money are generated from brokers that trades can borrow, also in crypto margin trading, cryptocurrencies are generated by traders to lend trades that want to borrow. So, the money or cryptocurrencies are provided by the third party. 

 

The profit

In margin trade, the profit is twice more or more, and that is why some people like to borrow to do margin trade. 

 

The loss

As the profit is twice more, the lose is also twice more or more. 

 

The Question

The question is, if someone lose, how is he going to pay back the money?

Edited May 1, 2020 by BitcryptoHan

[rekter 8129]

10 hours ago, BitcryptoHan said:

The loss

As the profit is twice more, the lose is also twice more or more. 

This is where you misunderstood. If you are playing with 5x leverage, your wins will be 5x as well but that doesn't mean you have to pay 5x as much back if you lose, because your odds to lose everything will be 5x as riskier because the liquidation level will be closer as well.

 

This is actually somehow difficult to explain, and it was hard for me to grasp when i started, so i'll just link to relevant explanation: https://www.investopedia.com/terms/m/margincall.asp

 

Still, i would recommend just to try it with a small sum, it becomes obvious when you do and adds to your experience.

Edited May 2, 2020 by rekter

[BitcryptoHan 2557]

8 hours ago, rekter said:

This is where you misunderstood. If you are playing with 5x leverage, your wins will be 5x as well but that doesn't mean you have to pay 5x as much back if you lose, because your odds to lose everything will be 5x as riskier because the liquidation level will be closer as well.

 

This is actually somehow difficult to explain, and it was hard for me to grasp when i started, so i'll just link to relevant explanation: https://www.investopedia.com/terms/m/margincall.asp

 

Still, i would recommend just to try it with a small sum, it becomes obvious when you do and adds to your experience.

The link was helpful, that mean it depends on the leverage, and using little amount to start will be good. 

 

2 hours ago, fila said:

The skill is to never loose enough that you actually end up having to pay stuff back unexpectedly but I do understand that this is far harder then it sounds.

I think also that it will be hard, and it will be better to start normal reading than margin trading. 

 

And I will like people to share their experience here if it profits them or not. 

[magd 5231]

In my opinion, traders should expect that there will be profit and loss, and therefore it will not be easy to recover the loss, especially if this is in investment deals and transactions. The investor must be immune to information so that the profit rate is much greater than the loss.

[jamesvince 2389]

Crypto market margin trading means huge amount of btc profit if you are extremely experts of blockchain technology or crypto trading other wise your account can washed if bitcoin pumps or dumps in suddenly then you may lost your all investment done in this market. So avoid from leverage trading if you have not enough skills of crypto market trading. 

[scorpiali 5626]

The Margin is more risked way to trade the risk is very high more than the profit ,to answer your question if you put 10 dollars with x5 and your trade go against you just with one per cent you lose your 10 dollars and the trade is closed that's mean your sold will be liquidated 

[BitcryptoHan 2557]

39 minutes ago, scorpiali said:

The Margin is more risked way to trade the risk is very high more than the profit ,to answer your question if you put 10 dollars with x5 and your trade go against you just with one per cent you lose your 10 dollars and the trade is closed that's mean your sold will be liquidated 

@scorpiali the money or crypto is borrowed, and if you lose the trade, what is going to happen? How are you going to pay?

[Honny143 13612]

Well I have no experience in margin trading, but i heard in his forum and some articles, margin trading is not easy  any new Comer's its need so much experience, because they give 5x are more leverage so if we in this trading then earn so much money, but unfortunately we loss then means our every things loss in few trades.

[scorpiali 5626]

4 hours ago, BitcryptoHan said:

@scorpiali the money or crypto is borrowed, and if you lose the trade, what is going to happen? How are you going to pay?

You dont pay all the money you have trade with because it's not your real money you just pay the percentage of what the trade lose 

[koussai999 1986]

On 5/1/2020 at 9:14 AM, BitcryptoHan said:

In fiat or forex margin trading, money are generated from brokers that trades can borrow, also in crypto margin trading, cryptocurrencies are generated by traders to lend trades that want to borrow. So, the money or cryptocurrencies are provided by the third party. 

 

The profit

In margin trade, the profit is twice more or more, and that is why some people like to borrow to do margin trade. 

 

The loss

As the profit is twice more, the lose is also twice more or more. 

 

The Question

The question is, if someone lose, how is he going to pay back the money?

I think that the person who wants to trade in the cryptocurrency market must make a solid plan for how to invest and the amount of risk involved
And it must be strict capital management

[kadayakito 765]

I have not tried margin yet, but I see many traders use margin both with forex. I have not tried it yet but I have heard that it is quite complex and sometimes risky. and I dare not take risks. with my current earnings I feel fine and there's no need for escrow

[Calvinpriva 17296]

Many sites which are giving loan they have their different ways for collecting their loans. But the most used way for collecting their loans is this, they will not give you a loan until you will deposit the same amount int their wallet that you need to borrow. That means, even if you will not be able to return their money they will just take it from your wallet.

[Michael0606 861]

Well, the margin of trade is very dangerous if you do not know the charts, since once you lose everything from your account you owe nothing but your account is burned by a strong liquidation.

[BTC Future 3946]

On 5/1/2020 at 5:14 PM, BitcryptoHan said:

The question is, if someone lose, how is he going to pay back the money?

The cryptocurrency brokers do not ask you for more funds to sustain your position. They liquidate it without asking for more. You can't go negative on Bitmex or Kraken, which I've traded in the past, although I would suggest to always read their rules as you never know what might change. About the rest exchanges that offer margin trading, I haven't looked into them and can't have an opinion.

Robinhood does go to minus by the way. If it goes to minus you have to fill the gap of the money you owe them to be able to trade again. They won't oblige you to pay them this amount though. I've read that other brokers can liquidate everything you own with them to cover your positions and can demand to pay them more.

[Jeet Narayan 1940]

In crypto market, margin trading is profitable and loss very risky . Traders are earning good amount from doing Margin trading . Also face huge losses on opposite market . So we should use less leverage in trading to reduce loss amount.

[Crypto123 0]

In my opinion, margin trading is like gambling, like dice you either win twice or lose twice, and therefore, if you lose, you will have to work double to get your money back, so for me I do not work in this type of trading, but I prefer normal trading.

[George10 9932]

I'm not much in crypto margin trading but I know it can be profitable if you are using a great strategy but this type of trading comes with high risk of losing your funds it's for this reason an education about it is recommended before jumping into it.

[malik6314193 5449]

On 5/2/2020 at 5:28 AM, rekter said:

This is actually somehow difficult to explain, and it was hard for me to grasp when i started, so i'll just link to relevant explanation: https://www.investopedia.com/terms/m/margincall.asp

I was also confused about this thing that how we can pay back. Because of we lose a big amount. We just have to close permanently acount and open new account. But now from your post i got it. 

[guatazoo 7150]

On 5/1/2020 at 5:14 PM, BitcryptoHan said:

In fiat or forex margin trading, money are generated from brokers that trades can borrow, also in crypto margin trading, cryptocurrencies are generated by traders to lend trades that want to borrow. So, the money or cryptocurrencies are provided by the third party. 

 

The profit

In margin trade, the profit is twice more or more, and that is why some people like to borrow to do margin trade. 

 

The loss

As the profit is twice more, the lose is also twice more or more. 

 

The Question

The question is, if someone lose, how is he going to pay back the money?

For the experienced trader, the losses trades are always 30% and the winning trades are always 70%, so if you lose in the single trade, just be patients and waiting for the next trade. 

[pablomarwan 3082]

You passed by this matter before the matter here is that you will not repeat any borrowing. How did you trade this on leverage to transfer Matala 1: 100 meaning that $ 1 equals $ 100 but when you start the transaction you will not start with $ 1 but rather with 0.01 here the company is in the process Calculation, meaning that when you lose the deal, you start to decrease the value according to what you set and when your account becomes 0 the deal is closed.

[BitcryptoHan 2557]

On 6/15/2020 at 5:05 PM, guatazoo said:

For the experienced trader, the losses trades are always 30% and the winning trades are always 70%, so if you lose in the single trade, just be patients and waiting for the next trade. 

I think it is better not to trade on leverage I a coin price as not really crashed, I have been thinking of it, it is not easy for price of a coin to increase and we can get the time wrong, the gain could be so little as well. Better to trade this way when price of a coin fall. 

[guatazoo 7150]

7 hours ago, BitcryptoHan said:

I think it is better not to trade on leverage I a coin price as not really crashed, I have been thinking of it, it is not easy for price of a coin to increase and we can get the time wrong, the gain could be so little as well. Better to trade this way when price of a coin fall. 

If you trade perfect by doing your own analysis such as fundamental analysis or technical analysis, you can be using the leverage without fears of loosing mostly of your money

[CryptoMaxim 2372]

In margin trading, the risk of falling losses is very rapid. With such a trade, you need to know for sure that the traded asset will only grow. And the question of how to return the money when you lose it. There is no way to return it. This is the market and the risk. If a loss is incurred during trading, this is not reversible.

[BitcryptoHan 2557]

On 6/17/2020 at 5:18 PM, guatazoo said:

If you trade perfect by doing your own analysis such as fundamental analysis or technical analysis, you can be using the leverage without fears of loosing mostly of your money

@guatazoo I have a question, can I borrow in leverage trading for over one to two months without my funds liquidated? Or leverage is only for short term trading?

[guatazoo 7150]

3 hours ago, BitcryptoHan said:

@guatazoo I have a question, can I borrow in leverage trading for over one to two months without my funds liquidated? Or leverage is only for short term trading?

When you gave been borrowed in the margin trading, the liquidation must be happened if your loss has exceed your invested money, but if the loss doesn't exceed your invested capital, then the trade can stay opened as long as it can till you close it your own.