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Author Topic: About leveraged trading and going long/short  (Read 956 times)
metalbean
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October 18, 2016, 03:47:48 PM
#1

I buy on BTCC using their trade exchange, which is a simple key and buy web system.

I am starting to look into their pro trade version which could do things like leverage or long or shorts but I am still trying to get the hang of it without much success, it says that "BTCC Pro Exchange is a leveraged bitcoin trading platform. Pro Exchange offers 20x/25x leverage, allowing users to maximize their profit potential. With 25x leverage, for example, you can go long or short on a position of 25 bitcoins for the cash value of 1 bitcoin."

What does the X leverage actually means? And what does it mean by going long or short?

Thanks in advance

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October 19, 2016, 03:36:17 AM
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A long position means you make money when the price of bitcoin goes up, and lose money when the price goes down. 25x means you make or lose 25 times as much as you would if you had actually bought the bitcoins, eg, if the price goes up 1%, you will make a profit of 25%. Conversely, if the price goes down 4%, you lose everything you invested. Game over. Thanks for playing.

A short position means you make money when the price goes down, and lose money when the price goes up. Again, you lose everything if the price goes up 4%.

I strongly advise that you do not invest in a leveraged position if you do not understand the risks involved.

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outatime1
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October 19, 2016, 11:44:00 PM
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Basically leveraged trading is borrowing. Other exchanges use terms like "margin". The exchange will let you borrow but you have to have some bitcoin in your account to cover what you borrowed so the exchange doesn't lose money.
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October 20, 2016, 09:50:30 AM
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Honestly I just know that in trade bitcoin can use leverage

leverage actually means, which allows you to move something by trading distance for force.

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October 21, 2016, 06:12:02 AM
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As Foxpop said I would stay away from leveraged trading in the beginning. You need a solid understanding of the mechanisms and the bitcoin market to prevent you from going bust in a tiny swing.

At 25x leverage even a moderate whale selling a big chunk of bitcoin can cause the price to move down enough to put you deep in the red.

The biggest "problem" is that once you lose the amount of what you actually hold, the exchange will force an automatic sell of those coins at the current loss, because you cannot cover the losses if you don't have more coins on your account.

metalbean
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October 21, 2016, 07:57:12 AM
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As Foxpop said I would stay away from leveraged trading in the beginning. You need a solid understanding of the mechanisms and the bitcoin market to prevent you from going bust in a tiny swing.

At 25x leverage even a moderate whale selling a big chunk of bitcoin can cause the price to move down enough to put you deep in the red.

The biggest "problem" is that once you lose the amount of what you actually hold, the exchange will force an automatic sell of those coins at the current loss, because you cannot cover the losses if you don't have more coins on your account.

Thanks, will stick with honest purchase. No to leveraging Smiley

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kateryana81
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October 24, 2016, 06:09:28 AM
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As Foxpop said I would stay away from leveraged trading in the beginning. You need a solid understanding of the mechanisms and the bitcoin market to prevent you from going bust in a tiny swing.

At 25x leverage even a moderate whale selling a big chunk of bitcoin can cause the price to move down enough to put you deep in the red.

The biggest "problem" is that once you lose the amount of what you actually hold, the exchange will force an automatic sell of those coins at the current loss, because you cannot cover the losses if you don't have more coins on your account.

Thanks, will stick with honest purchase. No to leveraging Smiley
It will be good if you can give detail reason why you think some should say noto everaging because some people believe its a very good way of making big amount from currency trading. For some to be convinced by your view, sufficient information would be still needed.

traderethereum
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October 25, 2016, 06:46:49 AM
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As Foxpop said I would stay away from leveraged trading in the beginning. You need a solid understanding of the mechanisms and the bitcoin market to prevent you from going bust in a tiny swing.

At 25x leverage even a moderate whale selling a big chunk of bitcoin can cause the price to move down enough to put you deep in the red.

The biggest "problem" is that once you lose the amount of what you actually hold, the exchange will force an automatic sell of those coins at the current loss, because you cannot cover the losses if you don't have more coins on your account.

Thanks, will stick with honest purchase. No to leveraging Smiley
It will be good if you can give detail reason why you think some should say noto everaging because some people believe its a very good way of making big amount from currency trading. For some to be convinced by your view, sufficient information would be still needed.

i think leverage/margin is only work if we know about the price directions, because if we only make predict, it will hard to make money. if we are sure that the price is going up, then we can use leverage/margin and we can make good profit.

i already trying leverage/margin too but i think i don't make a good profit and only small amount because it will depend on how much our budget we play on leverage/margin. if we have big budge like 1 btc, then we can get good profit, but for less budget, i don't think so.

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