Binance Margin trading, consists of trading leveraged with more capital than you have available, this capital is provided to you by the Binance platform in the form of a loan, so you can trade with more capital than you have available. The idea is to maximize profits. Invest your profits and quickly pay back the borrowed amount.

For example, if I have 100 BUSD I can buy BTC by investing 300 BUSD or if I choose more leverage, ten times more 3000 BUSD, but the available leverage depends on the selected pair,

Binance lends you with interest calculated by hours, the idea is that you can operate with more capital, get the most profit and as soon as possible return the borrowed capital, otherwise if you keep the loan will continue to charge interest, this is one of the first actions you should take to protect your assets, in the next section I will show you certain recommendations and guide you how to operate the trading margin.

 Continuing with the topic at hand, but first I must warn you that margin trading is a risky investment, if you are a beginner I recommend you to document yourself more, do traditional trading, learn and once ready do not hesitate to use margin trading to increase your profits,

Basically, the process for margin trading is as follows:

- Select which account to work with, cross or single margin.

- Make a transfer of the currency in which we will trade to the selected account, either cross-margin or single margin.

- Borrow the amount to trade with an amount greater than the available amount.

- Trade the trade

- Finally repay the borrowed amount

It is appropriate to clarify some concepts

Cross

When opening a trade, it takes into account the total amount of the margin portfolio, it will take the amount of all currencies held in the margin account as collateral to cover the risk of orders with settlement risk.

Isolated

This modality allows you to manage the risks according to the maximum amount that would be lost in case of liquidation, placing the margin for that open position, in isolated it will only take the amounts you have according to the pair used, plus the leverage. .

Other concepts you should be clear about

Long trading on margin

"Long is when you buy at a low price and then sell at a higher price. This way, you can profit when the price goes up.

Short trade with margin

"Short" is when you sell at a high price and then buy lower. This way, you can profit when the price goes down.

The PNL is an indicator that measures profit or loss, you must monitor, if it is geen you are in profit, red on the contrary.

Margin Level

The margin level is the relationship between a trader's funds and margin. The margin level shows the current risks, LTV indicates the risk of your trade. If the collateral currency loses value, LTV increases, indicating that my risk increases, if my collateral increases in value, it decreases the risk and allows it to decrease.

 LTV = Loan Amount / Collateral Amount x 100%.

 If your LTV is higher than the estimated margin, you must add more collateral or pay off the loan, if your LTV is higher than the liquidation LTV, your collateral will be liquidated to pay off your loan.

 Cross Margin Margin Level

Margin level of a cross margin account = total asset value of the cross margin account/(total liabilities + outstanding interest), where:

 Margin level of the isolated margin

Margin level of the isolated account = total value of assets in the isolated account/(total value of liabilities + unpaid interest).

Settlement fees

 You should avoid forced liquidations, because if this happens, you will have to pay liquidation fees, and the margin insurance fund will charge a percentage of the liquidation clearing fees.

Let's look at how margin trading works on Binance,

Earlier we mentioned how to enter the margin wallet, now let's get into margin trading.

 https://www.binance.com/es-LA/trade/BTC_USDT?theme=dark&type=cross

The first thing to do is to select the currency to put in guarantee and the currency to buy, that is to say the pair, in this case I will select the pair Btc/Usdt, generally I operate as the usdt currency which is the stable one, its value is always paired with the dollar, i.e.

1 usdt  es siempre igual a 1 dólar.

In Binance you have more than 1500 pairs to trade and about 370 cryptocurrencies.

Now we need to transfer to the cross margin account the amount of usdt I need to put as collateral.

I already have the cash loan. It is no longer the 30 dollars in usdt, but 90 dollars in usdt automatically since I am in cross margin and the leverage of 3x is assumed, what remains is to make the trade using the 90 dollars in busd to buy the corresponding fraction of BTC , if the market plays in my favor and is expected to rise the BTC to sell them and thus opens get a profit, then and very important select the payment option and thus the debit balance will remain at zero, if not every hour a percentage commission will be deducted.

In this example my intention was to buy BTC, but the market was not in my favor, by selecting pay I will be returning the amount borrowed,

It is a very easy and uncomplicated process, very similar to trading with isolated margin.

To finish this part I must mention something important as it is the margin cooling period, which is to temporarily suspend the margin process when conditions are not in your favor, it is a mechanism available in Binance to protect you.

How to select the cooling off period

The cooling off period is the temporary suspension of margin when conditions are not favorable. Loans will be suspended during the cooling off period.

I want to make it clear that I am not a financial advisor, the intention is to serve as a guide and make you aware of this important tool available on the Binance platform,

If you are a beginner user, I recommend you to stay away from this type of investments for the time being. Now if you are already familiar with cryptocurrency trading, you know and are clear about the risks, and you know the right time to invest, this tool will be very helpful to get good profits from the hand of Binance, invest with this tool and you will see your profits increase compared to traditional trading.

Trading with Binance, the leading exchange, is definitely the best option, both for security, ease of trading, liquidity of the exchange (the best in the market), another factor is the low commissions and very special just announced, New tiered interest rates, reduced for BTC, ETH, BUSD and USDT assets.

I find it very useful to use Binance margin trading for valid reasons:

1. I can increase my profits as I enter the market with larger positions by investing more than what is available, definitely leverage helps you with that.

2. It opens a very clear possibility to diversify my portfolio, since with a larger fund I can open more positions fragmenting the amount to invest and place more orders to be able to always cover the risks.

3.    As I mentioned, it allows a period of reflection.

4.     It has an insurance fund for users' accounts when they are unable to pay what is owed due to lack of funds or when their capital is less than 0.

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