What is Leverage & Margin Trading?
đMargin Trading
This means trading with borrowed money from the exchange.
â You put up some of your own capital and borrow the rest to open a bigger position.
đ Example: You have $10, borrow another $10 , and now you can trade with $20
đ Leverage
Leverage shows how many times your capital is multiplied in a trade.
2x leverage = 2 times your capital
5x leverage = 5 times your capital
đ Higher profits potential⊠but also higher risks!
đ Example:
If you buy BTC with 5x leverage and BTC pumps just 2%, you gain 10% profit!
But if BTC drops 2%, you also lose 10%!
â ïž Risk Management is Key
đ„ High leverage = fast profits but also fast losses.
â Always use a stop-loss.
â Start small with lower leverage.
â ïž Remember â ïž :
Leverage & margin trading are mainly for advanced traders. Master the basics first, then step into this high-risk, high-reward game
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