When trading futures on platforms like Binance or others, you will find two options to manage your capital: Isolated and Cross. The idea simply revolves around how to protect your balance if the trade moves against you.
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🟢 First: Isolated
Each trade is independent with its own capital.
If you put $100 as margin in a trade, the risk is only in that $100.
Even if you lose the entire trade, your remaining balance in the account is safe.
Suitable for beginners and those who want to control their risks.
📌 Example:
Entered a BTC/USDT trade with $100 isolated. If liquidation hits, you only lose $100, and your other balance remains unaffected.
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🔵 Second: Cross
Your entire capital in the account acts as collateral for the trade.
If the trade reverses, the platform starts withdrawing from your remaining balance to prevent liquidation.
Gives you more room to endure, but it's riskier.
If the market continues against you, you might lose your entire account balance.
📌 Example:
Your account balance is $1000. Entered a $100 "Cross" trade. If the price starts to reverse, the platform uses the remaining $900 to cover the losses. If the reversal continues, the entire account might be wiped out.
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✅ When do I use each one?
Isolated: If you want limited and clear risk. (Suitable for beginners)
Cross: If you have experience and trust your analysis and want more room for the trade, but you must bear the high risk.
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🎯 Summary:
Isolated = More security + Limited loss.
Cross = Higher risk + Possibility of losing the entire account.
Best regards ♥♥♥♥♥
