The isolated margin mode and cross margin mode are two essential margin management methods for crypto perpetual futures trading.
These modes differ significantly in terms of leverage, margin requirements, and risk exposure, affecting and shaping your trading strategies and risk management.
What is Cross Margin Mode?
In cross margin mode, your entire futures account balance acts as shared collateral for all open positions.
This offers higher risk tolerance for adverse market movements. However, if losses exceed your total margin, your entire balance may be liquidated.
For example, let’s say you have 1,000 USDT in your margin account. You open a 10× leveraged position with a notional value of 1,000 USDT. The entire 1,000 USDT amount now backs that position. If the market moves sharply against you, you could lose your entire margin balance.
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Happy Trading,
The WEEX Team
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