Topic: What is margin trading? (Read 677 times)

It is difficult to make a profit in the margin trading because it's more complicated than the usual trading and we need to have more skills to determine what is happening in the market. Once we make a small mistake, we are hard to back to the last price we bought because it depends on the market. But sometimes we are lucky to see the trend is up so we can make a lot of profit.

In the world of Trading, we know the term Margin as profit. But more often it is denoted in the form of a percentage of profit. So if someone says Margin, what he means automatically is the percentage of Margin.

If you have been trading for a long time I think you already understand the term terms that exist, and also you have understood a powerful trading strategy, but here I think you have a little problem, are you lost or profit?

I'd say margin trading is just buying stocks without having the entire money to do it. Am I right?

Margin trading allows you to loan money from broker against your funds to increase the buying power. For instance, you deposit $100 and leverage 5:1 to borrow $400 to buy cryptocurrency worth $500. Whether you make money or lose, you will have to pay the borrowed $400. The potential rewards can be high. The main thing is to guess the direction of the price’s movement: will it go down or up. If you do some homework, you will learn how to benefit when margin trading. Up to 10x leverage on Bitcoin and Ethereum offers cex broker - https://cexbro.com/, a newly launched platform. It provides very useful to trader negative balance protection feature that ensures that you won’t lose money than deposited and won’t owe money to the broker. Unfortunately, many platforms don’t offer it.

Indeed you are right that you can make some money in the bear phase by using the margin trading, but it is not that easy as you say. Because margin trading is generally practice by only the most advanced and experience traders who are very familiar with its mechanics and market patterns, and for that having you to have been so long in the crypto currency industry, I know for sure that you already been in a different ways and subways of life here in the crypto community. It is still up to you if you can make the margin trading work out, because if you think you can, then do it. Don’t hesitate your own capabilities and skills because it is only you who knows yourself more than anyone.

When someone can benefit from the purchase and sale of coins that they have, it can be said as a margin trading. Doing margin trading requires expertise and skill in analyzing the coins owned. Some people fail because they cannot be patient, in essence when we want to get profit margins then we must be really smart in making decisions. The ability we have will determine what we will get.

If I were to ask, using the margin trading in bear market is indeed a strategy to run but only a short period. But you should remember that trading on margin effectively is the best done assimilated with a reasonable amount of experience and strict risk management policy.
On the other hand, the advantage of the margin trading is that you can make a high percentage of gains compared to your account balance.

Margin trading is an investment option that is slightly different from the trades we are used to and with a higher risk, higher income potential. With this leverage-driven investment option, you can earn faster money and lose your capital faster. On the other hand, you cannot enter buy / sell orders while trading margin compared to standard trading. The orders you enter here are made as long / short. The long position represents that the price will rise, while the short position represents a decrease in the price.

Knowledge is the most important thing for trading as if you are well aware of everything about trading ti can give you good results as you will be able to move accordingly if price falls you will know how to survive for holding and if price is rising you will know selling is beneficial, so I think knowledge is very important now a day to trade, price is not good to trade we will have to wait for more time.

I recently tried to experiment with the LipChain project when their price fluctuations were quite positive. I did not manage to recover even the funds that I spent and as a result I am in the red by 50%.

Well, margin is a trading platform that practice every risk taker and investor of borrowed funds from the broker to trade a financial assets and this trading is you are borrowing an investment into other investor and if you will earn a huge profit you will pay a corresponding percent of you borrowed investment. I think it is like and same as the other platform trading. It applicable for the risk taker who want to invest a huge money. It is only for the brave people. That is my opinion about margin trading. I hope this information help you to make a good decision.

A one post account promoting a new and suspicious platform, under the guise of advice...... 

It is indeed a good strategy to use in bear markets (on a short), and ideal in sideways trends - as it makes even very small price movements highly profitable.

When margin trading you’re only required to deposit a fraction of your own personal capital (the margin) in order to gain exposure to much larger positions. The margin’s percent is determined by the amount of leverage utilized, i.e. its proportion to the total position size. For example, if leveraging with 100x, the margin will only be 1% (1:100). Simply put, every $1 becomes as powerful and profitable as $100.  If the trade goes against you, all you stand to lose is the initial amount deposited before the leverage was applied and the position increased.  

The risk: with a smaller margin/higher leverage, there’s less room in the market’s movement if it goes against you, therefore a greater risk of losing your initial deposit (margin).  But having allocated less of your own capital you can gear your portfolio and free up funds to put into other investment opportunities with a diversified portfolio. You could even place an opposing trade on the same asset (a short going against a long) to reduce the risk and outweigh the other’s losses.

So far, ‘prime xbt’ is the best exchange to margin trade with adjustable leverage of up to 100x on all of the 5 major cryptos available on the platform (BTC, LTC, XRP, ETH, EOS).

If venturing down this road be sure make use of stop-loss, protection, and OCO orders to manage risk and set clear entry/exit points (also available on primexbt), and be prepared for losses as well as gains.  

The fact is that due to the current state of the cryptocurrency market, even daily trading carries a lot of risk. Instability does not make it possible to earn high quality on the difference in price even in a weekly period.

Yes, yes you can make money during bear phase only if you have the knowledge in trading during this time. And this time was actually the hardest time to trade. Trading right now makes it really hard because the market is really unstable.

What is margin trading

So, basically, margin trading is another name for trading with borrowed funds.

It enables traders to enhance their profits on successful trades as the amount invested can be substantially bigger than what they can realistically afford to trade with.

The word “margin” refers to the amount of trader’s personal funds in his margin account (collateral). Naturally, the bigger the collateral, the more funds trader can borrow from the exchange to leverage.

In cryptocurrency margin trading, investors can leverage 2:1 (2x), 3:1 (3x), 20:1 (20x), or even 100:1 (100x) ratio, depending on the platform and the amount of risk they are willing to take.

But, obviously, margin trading is a very risky business, and the same way as it can generate hefty profits, it can engender serious losses for traders embarking on such an adventure.

Cryptocurrency exchanges enabling margin trading differ in many aspects, such as liquidity, leverage, interest rate, fees, trading pairs, etc.

Read the complete article about crypto margin trading.

Margin trading is way to make money from any situation of market,  in uptrend or downtrend we can make good profit if we have skill to predict the trend of market. But for margin trading, avoid greedy because this is factor that make loss money,  normally target profit for margin trading is 15% ~25% amonth. 

if everything is not good then our safest step comes out first from trading,
 the goal is that we avoid more losses, don't expect too much if the situation does not show improvement, if we don't have reserve capital then we don't need to trade, the risk is too big.
 Bitcoin trading is very fast changing so we must always monitor regularly.

Margin trading can be profitable if we understanding price action of crypto and have risk management, because with leverage the risk and the potential profit will be higher than spot trading. Margin trading will be more risky because of leverage, so make sure we use low leverage to minimize the risk so will be more possible to make profit.

What's more, is you can short sell.  Short selling, or shorting, is a way to profit from the downward trending markets.  This is a process where you borrow from the exchange/trading platform in order to sell high and buy back in at a lower price, thereby repaying the 'debt' and profiting from the difference in the sell and re-buy price.

Shorting, like margin trading with high X leveraging, is not a widely-available option at most existing crypto exchanges, but is much more prevalent in traditional financial markets. It allows for profit to be taken during lowering price actions, and can provide a means of creating more rounded trading strategies. A handful of advanced trading platforms like PrimeXBT (https://primeXBT.com) are now allowing for these renowned techniques used in forex/stock markets, with up to 100X leverage which can be applied to all positions (including short) to further increase profit potential in bearish markets.  

It is typically advised however to ensure effective risk management precautions are simultaneously utilized (like stop-loss orders, etc.) to limit your loss potential.  Additionally, it is also advised to start off with lower X leverage (up to 10X max) as stop loss orders can be executed more easily with high X leverage, meaning you'll lose your investment will less price movement, leaving less room for error.  There are many ways to profit in a bear market, but shorting is an ideal method - provided you conduct thorough technical analysis in order to trade with the trend.