#Day105 : Understanding Cross Margin vs Isolated Margin in Futures Trading
When trading futures on Binance, choosing between Cross Margin and Isolated Margin is key to managing risk. In Cross Margin, your entire margin balance is shared across all open positions. This means profits from one trade can cover losses in another, reducing the risk of liquidation—but it also exposes your whole balance. In contrast, Isolated Margin limits risk to just the margin allocated for that specific trade. If the position is liquidated, only that portion is lost.
Beginners often prefer isolated margin for better control, while experienced traders may use cross margin for flexibility. Choose wisely based on your strategy and risk tolerance.
Understanding this difference can help you survive market swings and trade with confidence.
