Key Futures Terms You MUST Know ๐๐ก
Before placing any trade, you gotta know the language of futures. These basic terms will help you survive and win in the game. ๐ง ๐ช
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1. Margin ๐ต
The money you put in to open a position. Itโs like your entry ticket. Small margin = big position if youโre using leverage.
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2. Leverage โ๏ธ
This is how you trade more with less.
Example: With 10x leverage, $100 becomes $1,000 in buying power.
โ ๏ธ More leverage = more risk = fast liquidations if you're wrong.
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3. Long vs. Short ๐๐
Long = You think price will go UP ๐ผ
Short = You think price will go DOWN ๐ฝ
You can profit both ways if you enter right. โ
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4. Liquidation ๐
If price moves too much against you, your position gets liquidated = full loss. Happens when your margin can't handle the loss. Manage your risk!
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5. Funding Fee ๐
A fee exchanged between long & short traders every 8 hours (on Binance).
Note: some tokens/coins have less or more funding fee duration.
If funding is positive, longs pay shorts.
If negative, shorts pay longs.
Weโll break this deeper soon!
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Bonus: PnL (Profit & Loss) ๐
Tracks how much youโve gained or lost. Know your numbers always!
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These are your building blocks. Master them now so we can dive deeper in the next lessons. ๐งฑ๐ฅ
