What do full margin and isolated margin mean? Will it affect my profits?

In the Binance trading interface, you will see two options: full margin and isolated margin (also known as cross margin).

Full margin mode: As the name suggests, it counts all the money in your account. When you incur losses, everyone shares the burden. If you have opened several positions and one position suffers significant losses, the platform will automatically withdraw funds from other parts of your account to help you cover the loss until all your money is gone. In this mode, the risk is shared.

Full margin is suitable for those who are bold yet careful. They believe that using all their account money to withstand momentary fluctuations can still help them endure. However, if there isn’t much money in the account, the risk of liquidation is very high.

Isolated margin mode: On the contrary, isolated margin is like opening a small “independent vault.” You can allocate fixed margin for each position, and even if you incur losses, you will only lose that portion of money without dragging the entire account down. This mode is more suitable for conservative traders, as even if one position is liquidated, the other positions remain safe.

For example: You have 1000 USDT. In full margin mode, if one position incurs losses, the platform will automatically use this 1000 USDT to help you withstand the loss; while in isolated margin mode, you can allocate 500 USDT to each position, so if one position loses all its funds, it won't affect the funds of another position.