Leverage:

Credit line

Or there is a possibility that there is no correct translation in Armenian, if we translate it directly, it will be a loan shoulder 😅 now let me explain what this is.

This is a loan that the exchange gives to the trader to complete the transaction with a larger amount than the amount the trader has at the time of taking the loan. By opening trades in this way, you can make a bigger profit than by just investing your own money.

A trader uses a line of credit to increase trading profits and to purchase more assets with additional funds for greater profits.

For example, you want to buy Bitcoin, which you think will go up. You have $100 in your account, but you want to buy $500 of Bitcoin, you can borrow the $400 you need from an exchange, and your own funds will be collateral during the transaction.

✅So, using a line of credit is using borrowed capital to purchase an asset that can increase profits. However, there are risks that I will introduce in other publications.