đ„What Are Leverage and Margin Trading? đ€
Letâs understand it in simple words đ
Margin Trading:
In margin trading, you borrow funds from the exchange to trade.
You use some of your own capital and borrow the rest to take a larger position.
Example:đ
If you have $100 and borrow another $100, you can trade with $200 in total.
What is Leverage?
Leverage means multiplying your capital to increase your trading power.
2x leverage = your capital is doubled
5x leverage = your capital is multiplied by 5
This increases both profit and risk.
Example:
If you buy BTC with 5x leverage and the price goes up 2%, you earn 10% profit.
But if BTC goes down 2%, you lose 10%.
Risk Management is Crucial:
High leverage can bring quick profits â but also quick losses.
Always use stop-loss orders and start with low leverage.
Remember:
Leverage and margin trading are only for traders who truly understand the market.
Learn first, gain experience, and then trade responsibly.
Trade smart, manage risk, and stay disciplined.
#CryptoTrading #MarginTrading #LeverageTrading #CryptoEducationđĄđ #Write2Earn
