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*This post has been written by Hedgehog, an MCS influencer and one of Korea's famous cryptocurrency key opinion leaders.submitted by MyCoinStory to MyCoinStory [link] [comments]
Greetings from MCS, the derivatives trading platform where traders ALWAYS come first.
If you are a bitcoin trader, you have probably heard of bitcoin leverage trading at least once. I think leverage is a very important function in bitcoin margin trading, along with short selling. What does leverage mean here?
The Definition of LeverageLeverage comes from leveraging, and we all know what a lever does unless you fell asleep in middle school. The lever principle consists of force, the perpendicular distance from the pivot, moment, and more... Actually, I forgot all about the concept of the lever principle. ;)
A simple explanation of the lever principle is the force multiplication using a small force to lift large objects. Scissors and bottle openers that we often use in everyday life are all using the principle of the lever. The leverage in Bitcoin margin trading can also be understood as a function that gives the effect of a large investment with a small investment.
Leverage is also commonly used in real estate transactions. When one's capital is $1 million and wants to purchase a $2 million building, borrowing $1 million from a bank or other financial institution and purchasing the building is also included in the concept of leverage. By applying this concept directly into the leverage on bitcoin margin trading, which will be explained below, one can purchase a $2 million building with a capital of $1 million, doubling the leverage.
The maximum leverage available for each cryptocurrency derivatives exchange varies slightly. You can use up to 100x leverage on the MCS Bitcoin derivatives exchange. This means that I can trade using up to 100x leverage, which means I can invest up to 100x of my capital.
When making a general Bitcoin transaction, if my capital is $500, the maximum number of Bitcoins that I can be purchased is only $500 worth of Bitcoins. However, on the MCS Bitcoin derivatives exchange, if my capital is $500 and uses 100 times leverage, I can trade with $50K worth of Bitcoins.
The profit and loss rate when trading with and without leverage is the difference between heaven and earth. Assuming that the Bitcoin price has doubled after purchasing, if you invested $500 without using leverage, you will make a profit of $500 and your last asset balance will be $1K. On the other hand, if you used 100 times the leverage and invested $500, the actual transaction will be $50K worth of Bitcoin, so your profit will be $50K, and my final asset will be $50.5K. As you may have noticed, you can earn as much profit as the leverage used. Thus, although my capital may be limited, by using leverage on the MCS Bitcoin derivatives exchange, I can realize an unbelievable return on my capital.
Since I am telling you about leverage, I would like to introduce to the MCS traders who actually realized financial freedom through Bitcoin margin trading at the end of 2017. BJ Wedorm, a legend amongst Korean margin traders, started investing in Bitcoin with $4K and "retired" after a year of trading with a fortune of $10 billion. He who was born in 1996-1997 traded on BitMEX using leverage to triumph the financial freedom we all dream of.
💡 "Poverty has many roots, but the tap root is ignorance." - Lyndon B. JohnsonIn Bitcoin margin trading, leverage is a means of trading large investment funds with small capital. Leverage trading is a typical high-risk high-return, a double-edged sword that can be beneficial or harmed to you depending on how you use it. I wish all MCS traders to realize financial freedom by wisely using this leverage, a key element of Bitcoin margin trading, along with short selling.
I am a Bitcoin margin trader, Hedgehog. Thank you for reading this post.
\Trading with leverage is clearly a way to earn a large return; however, it is highly risky. Before trading with leverage, I strongly recommend that you fully understand the advantages and disadvantages of leveraged trading.*
🔸 MCS Official Website : https://mycoinstory.com
🔸 MCS Telegram : https://t.me/mycoinstory_en
Traders ALWAYS come first on MCS.
MCS Official Twitter (EN): https://twitter.com/mycoinstory_mcs
MCS Official Facebook: https://www.facebook.com/MyCoinStory.official
Before answering this, let’s think: If Bobo in Los Angeles wants to leverage cryptocurrency returns, what should he consider first?submitted by Block_Topia to MXCexchange [link] [comments]
The answer given by Bobo may be: 1. Choose a currency with a small market value that he is familiar with. 2. Choose a safe and reliable exchange, and leverage trade through the exchange.
How to get the most out of cryptocurrency?
Unlike spot trading, in leveraged trading, the purpose of most traders is to obtain short-term high returns. Let’s assume Bobo is the same.
If drastic fluctuations happen, high-market-value cryptocurrencies require large amounts of margin. However, small-market-value currencies demand only a small portion of funds to cause drastic fluctuations. In this case, the latter one is more suitable for leverage trading to get the maximum profit.
Taking the five cryptocurrencies of BTC, ETH, LINK, DOGE, and VNT as examples, the current market value has reached $172.686 billion, $27.01 billion, $2.186 billion, $501 million, and $1.4114 million, respectively. If the market value fluctuates by 5%, then it requires margins of $8.634 billion, $1.35 billion, $107 million, $25 million, and $70,000, respectively.
Like putting boulders of equal volume and density into Lake Belga and the Baltic Sea at the same time, the water of Lake Belga will overflow the surface of the lake and irrigate the fields in Siberia, while the sea surface of the Baltic Sea will not show a ripple.
To conclude, the small-market-value currency is a better choice for Bobo as he wants to maximize profits in a short-term.
How to choose the right exchange?
At 17:56 on July 8, 2020, the leverage trading price of VNT/USDT in MXC Global rose by 14.17%. However, the leverage trading price of BTC/USDT increased by only 0.78% in 24 hours. Bobo is familiar with VNT, and has critical judgments on the price trend of it. Thus, before the price going up, he had already prepared to buy VNT long with multiple leverage.
At….., the VNT/USDT trading pair on MXC Global rose by …, while in the meantime BTC/USDT moved only 0.78% ……, he had already packed some 5x leverage VNT/USDT margin pair in his bag.
But the problem is that, at present, only our exchange and Bibox supportVNT/USDT leverage trading (margin trading). Bobo is a senior user of our exchange and is satisfied with previous experience. Therefore, he has obtained ideal returns by buying VNT long with five times leverage.（by buying long of VNT with 5x leverage）
This example proves that margin trading is a way to maximize short-term returns. The success relies on two indispensable aspects: a smaller-market-value cryptocurrency and a trading platform that supports a large number of margin pairs.
Among many exchanges in the world, we support as many as 78 margin trading pairs, which is the platform that supports the most currencies.
In addition, our margin trading system adopts isolated margin mode. it supports 2-10 times leverage , and allows automatic borrowing and returning functions. Orders and cancellations can complete borrowing and returning of currency.(The loan can be made or repaid automatically upon placing or cancelling an order).
From the beginning of 2020 till now, we have upgraded the leveraged trading system by 7 times, which has greatly optimized core indicators such as quoted depth, position spread, lending efficiency and matching efficiency (lending and matching efficiency).
Why choose a reliable trading platform?
“Reliability” means: 1. Safety and regulation-compliance. 2. The trading platform has strong risk control ability. Also, core indicators like quoted depth, matching efficiency and position spread, have advantages. 3. Pay attention to the core requirements of global users, produce cryptocurrency trading products with heart.
We have become the fastest growing one-stop cryptocurrency trading platform in the world.
At present, our trading business integrates OTC trading, currency spot trading, leverage margin trading, Leveraged ETF, index products, contract trading and POS staking services.
In 2019, our daily volume of trade accounts for 5% of the global market. The daily trading volume of MXC took 5% of the global market. According to CryptoRank data, our leveraged ETF currently accounts for 70.1% of the global market.
Since our establishment, we adhered to the development strategy of “centering on global users” and “global compliance trading”. With the support of strong products and professional team, we aim to create a one-stop cryptocurrency trading platform that meet users’ needs.
We have obtained legal licenses registered in the United States, Canada, Australia and other countries, so we can conduct cryptocurrency trading legally and locally in those countries.
In terms of OTC, we have reached strategic cooperation with European payment company Simplex and Southeast Asia payment company Banxa, which allow users to directly purchase BTC, ETH with Visa and MasterCard.
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Leverage then allows you to trade larger positions than the amount of your initial margin. The leverage at Trading.com ranges from a ratio of 1:1 to 30:1. For example, if you have $1,000 in your trading account and you wish to use $500 of it to open a position on the EUR/USD currency pair, your leverage ratio will be 30:1. Leverage is the increased “trading power” that is available when using a margin account. Leverage allows you to trade positions LARGER than the amount of money in your trading account. Leverage is expressed as a ratio . What is Leverage in Forex – Leverage Ratio Explained. Trading in margin bears enormous risks. But, it also has the potential for huge rewards. As a rule of thumb, the bigger the leverage is, the smaller the margin blocked for each trade. We explained earlier the inverted relationship that gives the leverage formula. The Advantages of Margin Trading: Leverage is of the greatest advantage in margin trading. Margin can increase your profits dramatically. For example: with 10% of margin you can buy 10 times of the cash stocks in future market. Let us take an example to better understand the advantage of leverage. Margin trading lets you amplify your gains from market swings, allowing you to execute more complex, active trading strategies. With the power of Kraken’s advanced trading engine, you can use leverage to go long or short on a variety of cryptocurrencies by up to 5x -- you’ll have five times the earning potential compared to a regular spot
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One trading jargon that you’ll hear very often is margin. It’s usually in terms like margin account, margin trading and even margin call. It seems a bit comp... What is margin trading? What is a margin? What is the difference between a cash account and a margin account? In episode #34 of Real World Finance we dive de... Options are not suitable for all investors as the special risks inherent to options trading may expose investors to potentially rapid and substantial losses.... Leverage allows you to potentially trade more money than you have in your account. Leveraged trading carries a high degree of risk. Carefully consider your f... Get this tool for free: https://www.xm.com/trading-tools In a margin account, traders can take advantage of leverage to trade bigger positions than the value...