Topic: Different level of risk in crypto currency trading - page 2. (Read 770 times)
Margin trading is known for the ability to trade larger than the amount deposited. There is a lot of skill required or the risk is high. The meaning of margin trading is that a trader decides that they want to make a trade larger than the capital they have and looks to the platform to borrow these funds to open a larger Etherium position. look This leveraged margin allows you to make higher profits if the position goes in the right direction after the trade. However, the risk is that if the trade fails the amount of loss can be increased.
Risk is a component of the characteristics of the crypto world. There are several categories of risk pertained to in cryptocurrency. In this virtual world, the risk is spread at every stride. Risk of buying and selling. Risk on the scam in the market, risk in long term investment, and many more here. When you buy BTC that can be happened after buy, the price can befall. And the scammers are aware of stolen money from people.
Of course crypto trading has different levels of risk, depending on us choosing coins, trading features and the amount of capital used.
For me, these three things greatly affect the level of risk that must be faced. Suppose we select new coins with popular coins, of course
it is more risky to trade with new coins. Then if we choose margin trading features, of course there is a big possibility that we will lose
all our capital if we do not have good experience and knowledge in the world of trading. Therefore, if you are not professional traders,
avoid using margin trading features, just focus on using spot trading. And the last thing that distinguishes the level of risk when trading is
the capital we use, the more capital we use, the greater the risk we have to face.
For me, these three things greatly affect the level of risk that must be faced. Suppose we select new coins with popular coins, of course
it is more risky to trade with new coins. Then if we choose margin trading features, of course there is a big possibility that we will lose
all our capital if we do not have good experience and knowledge in the world of trading. Therefore, if you are not professional traders,
avoid using margin trading features, just focus on using spot trading. And the last thing that distinguishes the level of risk when trading is
the capital we use, the more capital we use, the greater the risk we have to face.
Personally, even though I spend a large amount of money ready to lose but basically I don't want to lose everything, at least if we have management in this risky investment, as much as possible the money we invested back into our wallets with a bad estimate only partially or a few percent and the worst thing is to lose it all. So, the risks regarding the project and the exchange itself I think can be avoided, because as long as you only use reputable and trusted exchanges it is enough for you to minimize the risk, because the next step is back to your own skills.
There’s a risk everywhere the only difference is the level of risk and if we are talking about trading cryptocurrency here, expect a high level of risk because you can lose money here in just a day if you make a bad decisions.
The volatility is normal in cryptocurrency, traders love that risk so they can pump and dump their token as easy as they could. There’s a big risk on a new project, and that’s your decision whether to buy or not, as long as you are willing to lose money then you’re already a risk taker.
The volatility is normal in cryptocurrency, traders love that risk so they can pump and dump their token as easy as they could. There’s a big risk on a new project, and that’s your decision whether to buy or not, as long as you are willing to lose money then you’re already a risk taker.
But if we take a simple example: If I just would like to buy some (simple) CEL shares for 1000 $, this would be the maximum I could lose right?
The reason I am asking is that for some COINS, on coingecko there is a disclamer saying 'Highly volatile investment product. Your capital is at risk.' (which is a banner sponsored by etoro, but it doesnt appear at all cryptos...)
The reason I am asking is that for some COINS, on coingecko there is a disclamer saying 'Highly volatile investment product. Your capital is at risk.' (which is a banner sponsored by etoro, but it doesnt appear at all cryptos...)
No need for a banner that must show for every crypto as trading, either stocks or crypto is always risky. There are no safe trades as if everything is that easy, we are all success by now or basically, no trading activity at all.
I understand that with speculative cryptos you can lose part of or all of your investment, but is the risk limited to the amount i laid out? When I was trying to buy a similar crypto on binance they displayed some warning as well which confused me quite a lot...
No need to be confused. Just keep in mind that crypto trading is risky no matter what coins you choose. Just because you don't see a warning or notice on that specific coin, it means they are on another level of risks of crypto trading.
Be used to see it from now on.
Risk is already a common factor existing in this industry for risks are always associated on anything you will do in this industry of crypto. I think the level of risks relies depending upon the coin for they have different price behaviors in the market and the changes on the prices on a span of time. Level of risks can also be associated upon the level of intellectual capacity of an individual to decide and familiarize himself on which crypto coin he will wish to trade. If someone is not that familiar into such coin and that coin was just a new one, then expect that it is a higher level of risk associated on that scenario compared to knowing your chosen coin for trading which is you are putting into lessen the associated risk for you are knowing how you will deal with such risk on that coin that is possible to be encountered along the trading process.
There is always risk involved in crypto, that's why you are seeing that kind of warnings. And there's risk aversion as well, so it's really up to us on how to manage it. So personally, I don't see that there are different though, risk is a risk. The big question is how you are going to mitigate the risk? Do you have plans?
Knowing how to deal with risk is one of the skills that you need in order for you to become a successful trader, and yes all the risk are the same but it increases the moment you decided to take more risk. Making plans and strategies can lessen that risk especially in trading cryptocurrency where volatility is very high. Don’t expect not to lose money instead prepare for it and have a back up plan always.
The volatility feature of the market brings it into a higher level of risk when it comes to investment and much more for trading. As we can see, a lot of trading platforms currently existed in the market but crypto trading is a little bit far from them. If we could ask ourselves, why I should choose crypto trading if there is high-risk waiting for me? it simply because we are driven by our positive mindset, money, and the possibility of gaining more profit is higher also than the others. But the problem is that and mostly the case that it happens to newcomers, they have been losing a lot instead of making a profit due to their own lapses.
As long as you stick with spot trading, it is possible that you will only experience a loss according to the amount of capital you use for trading.
But the risk becomes big when you use the margin trading feature, you can experience a loss much greater than the capital we use. And the
coins themselves have a different risk from one coin to another, depending on the liquidity and volume of the coins.
You are right about this, spot trading will indeed give you a loss according to the amount of capital and your entry price on the coin you choose. If the price drops to 100% you still have hope that your asset can go up like the other initial prices.But the risk becomes big when you use the margin trading feature, you can experience a loss much greater than the capital we use. And the
coins themselves have a different risk from one coin to another, depending on the liquidity and volume of the coins.
However, it is different if you use Margin Trading, the losses will be greater and can even be affected by liquidity. Margin trading is only recommended for professionals who already understand trading. Don't even try if you don't know the basics. Whatever money is owned will be lost in an instant. Use a demo account if you really want to try it.
What is missing is research! Ok you got some warning messages, why didn't OP try to investigate more about it? Maybe there're valid reasons for those warnings, maybe it's a shady project, but if you wish to know more you need to check it by yourself, you can't expect others to do the job for you!
Now I could check more about this specific project and to find out why it's flagged by some services, but I have no interest in doing that, I don't have interest in this specific project mentioned by OP! If you are investor, or wish to be, you need to DYOR, in the end it's your investment (money) and it will be your profit/loss!
Unfortunately many come to this market thinking that money is just going to come to them without making any effort, they just want to invest in a coin, any coin, and then reap the rewards and we know things do not really work like that, the few that are successful investing in new coins are able to pull that off because they dedicate all their free time to read as much as they can about every single project they can find, and after looking at hundreds of projects they finally find one that is worth it and invest their money there and very few people have the dedication of doing something like that and that is why they fail. Now I could check more about this specific project and to find out why it's flagged by some services, but I have no interest in doing that, I don't have interest in this specific project mentioned by OP! If you are investor, or wish to be, you need to DYOR, in the end it's your investment (money) and it will be your profit/loss!
As long as you stick with spot trading, it is possible that you will only experience a loss according to the amount of capital you use for trading.
But the risk becomes big when you use the margin trading feature, you can experience a loss much greater than the capital we use. And the
coins themselves have a different risk from one coin to another, depending on the liquidity and volume of the coins.
But the risk becomes big when you use the margin trading feature, you can experience a loss much greater than the capital we use. And the
coins themselves have a different risk from one coin to another, depending on the liquidity and volume of the coins.
Setting up plans and having a good insight in regards to types of trading that you'll going to follow.
There's always risk that accompanied your investment from the first time you enter the exchange, but as long as you know how to handle it and you are always ready in taking that level your chances to gain from that risk is also high.
Keeping yourself tied with patterns that you are following will make you profitable in the long run, you just need to learn how to manage it the right way.
There is nothing like 'being more volatile than the other', all of them, as long as it's cryptocurrency, is volatile. Last time I checked on eToro they are only trading a few of the top cryptos like Litecoin, Ethereum, bitcoin, etc. And these ones are not even as much volatile the smaller cryptos can be (they are volatile, but what I am trying to say is that they can't be easily manipulated by anyone, unlike the small ones that can easily be manipulated by whales).
So, investing in smaller market cap cryptos carries more risks than the cryptos with a huge market cap. Small market cap cryptos can plummet at anytime, and easily. So if there is any thing such as level to risks in trading cryptocurrencies, then I guess it's what I have just explained here. But all trades are risky.
So, investing in smaller market cap cryptos carries more risks than the cryptos with a huge market cap. Small market cap cryptos can plummet at anytime, and easily. So if there is any thing such as level to risks in trading cryptocurrencies, then I guess it's what I have just explained here. But all trades are risky.
There is always risk involved in crypto, that's why you are seeing that kind of warnings. And there's risk aversion as well, so it's really up to us on how to manage it. So personally, I don't see that there are different though, risk is a risk. The big question is how you are going to mitigate the risk? Do you have plans?
Yes. Once you're into crypto trading, the risk will always be there. This is the reason why you should only invest what you can afford to lose because in trading, there is no guarantee if you will make profits most of the time. One mistake will surely left you empty handed if not being controlled. I don't think there are different level of risks. The only concern here is how you will take the risks and overcome it. 
There is always risk involved in crypto, that's why you are seeing that kind of warnings. And there's risk aversion as well, so it's really up to us on how to manage it. So personally, I don't see that there are different though, risk is a risk. The big question is how you are going to mitigate the risk? Do you have plans?
What is missing is research! Ok you got some warning messages, why didn't OP try to investigate more about it? Maybe there're valid reasons for those warnings, maybe it's a shady project, but if you wish to know more you need to check it by yourself, you can't expect others to do the job for you!
Now I could check more about this specific project and to find out why it's flagged by some services, but I have no interest in doing that, I don't have interest in this specific project mentioned by OP! If you are investor, or wish to be, you need to DYOR, in the end it's your investment (money) and it will be your profit/loss!
Now I could check more about this specific project and to find out why it's flagged by some services, but I have no interest in doing that, I don't have interest in this specific project mentioned by OP! If you are investor, or wish to be, you need to DYOR, in the end it's your investment (money) and it will be your profit/loss!
There is a risk in all forms of business or endevour with a currency value attached and very much crypto trading isn't left out. It's not surprising that traders have definitely got a lot of evaluation to do with regards to risk.
Risks on trading has got several spares. From your lot size, spread, trading position in the market, account size and more.
As a good trader, risk management is one of the vital steps you've got to develop and master. It plays a role in determining why you should enter a trade, when you should enter and exit and ensures, what lot size you should enter a trade with with respect to your account size despite the leverage at your disposal as it has a direct relationship with the commission you would be paying as well.
Risks on trading has got several spares. From your lot size, spread, trading position in the market, account size and more.
As a good trader, risk management is one of the vital steps you've got to develop and master. It plays a role in determining why you should enter a trade, when you should enter and exit and ensures, what lot size you should enter a trade with with respect to your account size despite the leverage at your disposal as it has a direct relationship with the commission you would be paying as well.
One question I came across is if there are different level of risks for different cryptos? I know that generally cryptos are like stocks, ie you only can lose what you invest; but obviously there are financial products to deal with leverage etc.
I sort of understand that you are trying to ask there will be any differences at risk levels between crypto investments and other investments. The simple answer that will be, 'no'. There is no big differences in risk levels in all investments from crypto investments. All the market are volatile and hence crypto markets are volatile as well and the level of volatility in cryptos may differ time to time but that is the basic measurement for the level of your losses may incur in your investment.If you invest $1000, the maximum you may lose is the same $1000 even in leveraged trading. There will be no additional losses just because of you are opting for leveraged trading. But, losses may occur more rapidly in leverage trading than spot trading.
As long as you stick with spot trading, it is possible that you will only experience a loss according to the amount of capital you use for trading.
But the risk becomes big when you use the margin trading feature, you can experience a loss much greater than the capital we use. And the
coins themselves have a different risk from one coin to another, depending on the liquidity and volume of the coins.
But the risk becomes big when you use the margin trading feature, you can experience a loss much greater than the capital we use. And the
coins themselves have a different risk from one coin to another, depending on the liquidity and volume of the coins.
I would not advise using margin trading because the risk will be double than the usual trade. Without proper knowledge in trading, you will find it hard to follow the trend or the price, and you can make a wrong prediction. But if you still use the usual trading type, I guess that even if you buy bitcoin at a current price and the price is down, you can still profit later when the price starts rallies.
The bigger money you use in trading will give you a bigger risk, and you have a big chance to lose the money too. But if you can manage your money to trade, I think you can minimize the risk of losing the money, and you will get the opportunity to make a profit. So you need to determine how much money you will use in trading.
As long as you stick with spot trading, it is possible that you will only experience a loss according to the amount of capital you use for trading.
But the risk becomes big when you use the margin trading feature, you can experience a loss much greater than the capital we use. And the
coins themselves have a different risk from one coin to another, depending on the liquidity and volume of the coins.
But the risk becomes big when you use the margin trading feature, you can experience a loss much greater than the capital we use. And the
coins themselves have a different risk from one coin to another, depending on the liquidity and volume of the coins.
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