Many friends often ask me about the difference between full position and isolated position, so let me explain it to you in detail today.
Full position mode means that all available balances in your account can be used as margin to avoid forced liquidation. The advantage of this mode is that as long as the leverage is moderate, the possibility of liquidation is very low, so it is often used for hedging.
Isolated position mode means that the margin allocated to a position is limited to a certain amount. If the margin of the position is not enough to support the floating loss, the position will be forced to close. Therefore, in the case of high volatility and large leverage, isolated position mode is easy to be forced to close, but the final loss is only the position margin, and it does not affect the account balance.
Types of margin:
Isolated position margin: Independent margin is the margin of a single position, which is independent of other positions and supported by the balance of an independent margin account.
Full position margin: Cross margin means that all positions share margin, which is supported by the balance in the entire margin account.
In general, full-position leverage is more suitable for institutions or users with rich experience as a hedging tool, while position-by-position leverage is more suitable for novice users to limit losses within a certain range.
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