#Cross Margin

**Cross margin** uses the entire balance of your account to cover the margin for all your open positions. This means that if one position starts to lose money, the funds from your other positions can be used to prevent liquidation.

**Example:**

Imagine you have $10,000 in your trading account. You decide to open two positions:

1. **Position A:** Long 1 BTC at $40,000 with 10x leverage.

2. **Position B:** Long 1 ETH at $2,000 with 10x leverage.

If the price of BTC drops to $35,000, your position A will start losing money. However, because you are using cross margin, the funds from your position B (ETH) can be used to cover the losses in position A. This means you have a buffer that can help prevent liquidation, but it also means that if the market moves against you significantly, you could lose your entire account balance.

#Isolated Margin

**Isolated margin** allows you to allocate a specific amount of margin to each position. This means that the risk is limited to the margin allocated to that particular position, and other positions are not affected.

**Example:**

Using the same $10,000 account balance, you open the same two positions:

1. **Position A:** Long 1 BTC at $40,000 with 10x leverage, but you allocate $1,000 as isolated margin.

2. **Position B:** Long 1 ETH at $2,000 with 10x leverage, but you allocate $1,000 as isolated margin.

If the price of BTC drops to $35,000, your position A will start losing money. However, because you are using isolated margin, only the $1,000 allocated to position A is at risk. Position B is not affected by the losses in position A. This means that even if position A gets liquidated, you still have the remaining $8,000 in your account and position B remains intact.

Key Differences

1. **Risk Management:**

- **Cross Margin:** Higher risk as your entire account balance is at stake.

- **Isolated Margin:** Lower risk as only the allocated margin for each position is at stake.

2. **Flexibility:**

- **Cross Margin:** More flexible as profits from one position can cover losses in another.

- **Isolated Margin:** Less flexible but provides better control over individual positions.

3. **Use Case:**

- **Cross Margin:** Suitable for experienced traders who can manage the risks and want to maximize their leverage.

- **Isolated Margin:** Suitable for traders who prefer to limit their risk on individual positions.

By understanding these differences, you can choose the margin type that best fits your

trading strategy and risk tolerance.$BNB $STEEM