What is Binance Margin? How to effectively play Margin on Binance 2022
Margin Binance is the solution to help you solve problems when the market is gloomy with small fluctuations. By using this platform, you will be able to earn high profits even when the trading market is not volatile. So, have you heard about Binance margin? Here, let 's find out some related information about margin with cryptobnb as well as how to play margin on Binance.
The simplest way to understand Binance Margin
What is margin trading?
Before participating in specific learning about this platform, investors buying and selling Bitcoin, buying and selling Ethereum must have a clear understanding of what margin trading is. Therefore, the information below will definitely help you solve the above question.
- For larger capital, margin accounts have more trading positions than other margin accounts. Regular account investors can earn higher profits with successful trades.
- You can easily understand that margin trading will increase the value of your regular trades. In markets with low volatility, such as the international forex market, margin trading is also heavily used in the markets for stocks, commodities, and cryptocurrencies.
For example
With the example below will definitely help you better understand margin binance, a platform that is being offered with an extremely diverse and potential.
- You have 10,000 USDT in your Binance account, BTC price is currently 10,000 USDT/BTC. You open 1 regular Buy BTC order, you can only buy 1 BTC. After that, the price increased from BTC to 11,000USDT/BTC. You are selling 1 BTC that you bought earlier and you end up getting 11,000 USDT, a profit of 1,000 USDT compared to the beginning.
- In another transaction, you have 10,000USDT in margin wallet, current BTC price is also 10,000USDT/BTC, you open 1 3BTC margin buy order. At this point, you have used your 1,000 USDT and borrowed 2,000 USDT from Binance. After that, the price of BTC rose to 11,000 USDT/BTC. You sell the 3 BTC you bought and you get 33,000 USDT. You pay $20,000 borrowed (assumed zero interest), $13,000 received into the account, $3,000 in interest with only $10,000 initially.
Open a Margin Trading account on Binance exchange
To be able to trade and make margin on the Binance exchange , the first and mandatory requirement is that you have an account to log in to the Binance platform. After successfully registering an account at the exchange, you can follow these steps to open a Margin account on Binance.
Instructions to open an account using Margin on Binance
Step 1: After logging in to your Binance account, click Exchange and then select Margin
Step 2: Choose to open a margin account
Step 3: Read the agreement raised by the exchange, click on the box to agree to the agreement and then select I understand.
Instructions to access Margin Trading wallet (Margin wallet) at Binance
To access the Margin Trading wallet in the easiest and most convenient way, select Wallet then select Margin Wallet
Margin wallet access instructions for trading X10 at Binance
Margin wallet on Binance exchange
- Show balance information
- Total balance
- Total debt
- Assets in Account= Total Balance – Total Debt
- Profit & Loss: Profit and Loss. Calculated in BTC and USDT
- Show your margin
Is the level of possible risk calculated by: Margin level = Total asset value / (Total borrowed value + Total accumulated interest value)
- Area for transferring money to wallet, borrowing, paying
- Transfer: can transfer money from Binance Wallet to Margin Wallet or vice versa
- Borrow/Repay: Use a mortgage account to easily borrow/Repay the previously borrowed amount
- Trading: go to Margin Trading interface
- Borrowing History: Borrowing History
Switch from Binance wallet to Binance Margin wallet
Step 1: Select the coin you want to convert and then click on Transfer
Step 2: Enter the amount of coins you want to transfer then click Confirm transfer
Note: You can choose “-><-” to reverse that coin from Margin Wallet to Exchange Wallet
Borrow and Payback Binance Margin Trading
Step 1: Select the coin you want to borrow or pay then click Borrow / Pay.
Step 2: There will be two cases in this situation. If you want:
- Loan: Enter the amount you want to borrow then click Confirm loan
- Refund: Similarly, enter the amount you want to refund. The amount you have to pay = loan + interest.
Transferable coins and Binance Margin Trading wallet loan fees
Currently Margin Binance is providing the following 3 main specific coins:
- Borrowable: Can borrow
- Daily Interest/ Yearly Interest: Daily interest/ Annual interest.
- Borrow Limit: Borrow Limit
Place Margin Trading orders on Binance exchange
To place a Margin order at Binance, you can easily do it with the following steps:
Place a Margin order for a chance to make big profits
Step 1: Go to Binance Exchange, then select Margin
Step 3: Select the trading pairs in which you want to place orders. Margin trading pairs will have the symbol “M”.
Step 2: Place orders as usual at other platforms. Currently, Binance has orders such as: Limit, Market, Stop-limit , OCO
Modes or modes:
- Normal: Ordering mode as usual
- Borrow: Auto mode. That means the system will automatically lend you
- Repay: Auto-repay mode. It means that the amount of coins after you trade will be automatically returned to the correct volume and the same coin in the escrow.
Things to know to avoid losing money when playing Margin Binance
Answers to questions related to Binance Margin
Advantages of margin trading
Binance margin trading gives you the chance to make big profits. Specifically
- Playing on Binance margin can give you a higher profit than opening a similar trade in regular currency trading, this is the most prominent benefit that attracts everyone
- The platform allows you to diversify your investment portfolio. Since you can use leverage, you can open and earn more positions with the same initial capital.
- Trading with financial returns makes it easy to start trading quickly without much capital.
Disadvantages of Margin . Trading Feature
While there are many practical benefits, Binance margins also have a lot of major risks and downsides that need to be overcome. Let's take a look at some of the errors that Margin is having:
- Margin is easy to lose: Margin is like a double-edged sword. The more options you have, the bigger the loss.
- When you make bad business decisions, you face challenges that have large loss rates.
- Because of the high risk, the more you lose, the more likely it is to liquidate unintentionally.
Use BNB as transaction fee to get 25% off transaction fees
One of the information that you need to know carefully when making transactions at Margin Binance is that you can get a 25% discount on fees when using BNB to pay for trading fees. Therefore, to avoid losing such a lot of margin trading fees, you can enable payment of trading fees with BNB .
The condition is that you must have enough funds in your BNB wallet to use it as a transaction fee. If there are not enough BNB credits in your account, you will be charged as usual.
Differentiate Cross and Isolated Margin to avoid "account burn"
The Cross and Isolated Margin feature are both extremely useful support tools that will help players get the option of using capital effectively to avoid liquidation of the trading position.
Distinguish two forms of cross and isolated margin
Cross Margin is understood as your use of the entire available balance in your account to avoid the situation of being liquidated when your position is in a state of contrary to the market trend. When your position is forced to be liquidated, your account may be completely lost. However, reality shows, if your account is larger than the market drop, then your position can be kept intact until you want to execute your take profit order. me.
Isolated Margin is the opposite of cross in that it only allows your margin balance to be used to prevent your position from being liquidated. When the market is trending against your position, if you lose more than your margin balance, your position must be closed immediately.
Precautions when using Margin
If your position goes against the trend of the market, you have no way of knowing when the market is moving in the right direction with your trade. Therefore, it is better to use your entire account balance to continue operating. Liquidation is a risky decision and can lead to “account exhaustion”.
When investing, you only need to put a certain amount of capital to be ready to lose in a trade. You have decided on the wrong position, accepted a loss on that trade and are looking for another opportunity. This is how isolation escrow works. And we recommend that you use this feature to ensure that your investment is safe and always in the most stable condition.
With the information that we provide above, we hope you have the most overview of Margin. As well as understanding what is Binance Margin? This is a reputable platform belonging to the world's most prestigious electronic exchange - Binance, which gives you the opportunity to earn high profits when trading. So, if you want to experience a lot of challenges and risks in trading, then this is the platform you should try.
