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Author Topic: Don't use margin  (Read 74 times)
TronPower
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March 14, 2018, 12:33:28 AM
 #1

If you use margin, you cannot HODL, and you would be tapped out on the recent decline. Crypto is already a hugely risky investment. If you are right about the overall trend and coins with the most potential, then you can do very well. Don't be greedy by taking excessive risk, such as by taking on margin. You can be tapped out on a very short term decline, then you lose your position. As the old turkey in Jesse Livermore's famous book said, "To lose your position is something no one can afford, not even John D Rockefeller." In today's world, I'd change JD Rockefeller to Jeff Bezos. If Mr. Bezos had used margin to hold his AMZN stock, then he would have lost his position in the dot com crash.

I wrote this because I had considered moving coins to Poloniex where margin trading is available. I'm super glad I did not because I would have been even more fu*cked on the recent decline.
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March 14, 2018, 02:02:27 AM
 #2

Using margin in trading bitcoin or altcoins is risky your balance is not sufficient for backup, you can lose your bitcoin completely, we better trade in the normal way just to be more secure.

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March 14, 2018, 03:20:07 AM
 #3

I also feel that the margin should not be used, because the risk of margin is very high, and your mistake will probably result in the loss of your encrypted currency.

Nerman
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March 14, 2018, 03:33:15 AM
 #4

This is true, Basically you are getting a loan from a bank to bet on a coin well in this case you are loaning from the exchange. Trading is risky enough and using margin will just make it riskier. I have known some people who lost a huge amount of money because of it. Just use your own capital and you can use any strategy you wish to do.

iryboy
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March 14, 2018, 03:54:01 AM
 #5

Margin is very risky and you can lose money very quickly.

Edsel_Miller
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April 21, 2018, 06:56:25 PM
 #6

Margin is debt. You borrow capital from your broker to buy more assets, in most cases stocks. You want to invest a lot but lack of capital, you analyze that it is certainly profitable to use margin completely.
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April 21, 2018, 07:14:21 PM
 #7

Investing on margin means employing debt and adding to your expenses. In this kind of a situation you have to be pretty sure that your returns on the investments are more than your fixed expenditure, i.e., more enough to cover all your costs and get you some sort of return as well.

But investing without margin lets in the flexibility factor and gives you an edge to HODL your investment for a longer period of time. So in order to use ,margin in your investment portfolio, you have to be smart and very much financially disciplined in order to manage your portfolio.

You must never use margin in the following situations:

BTC To buy such kind of assets those yield lower returns than what your margin demands.

BTC And when you are doing dividend investing.


  

 
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dado7
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April 21, 2018, 07:20:37 PM
 #8

If your strategy is to hold long term, then no point in using margin trading, yes. Margin trading, trailing, stop loss etc etc are all for short-term holders and daily traders.

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April 21, 2018, 07:33:27 PM
 #9

True. Risky and easy to lose money
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April 21, 2018, 07:44:28 PM
 #10

I somewhat agree with op. Marginal trading is risky and no one should take this type of risk even if they think they have calculated all the possibilities. Anyway, different strategies about trading getting involved nowadays so I think Bitcoin can get some boost as because some new trading invention can happen soon as because Many new theories about trading came out recently. Just they will take some time to verify and get some witnesses on it and with the modern technology, we can get futuristic predictions using AI.
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April 21, 2018, 08:58:11 PM
 #11

This should be a unversial rule, you're going to get killed if you start using money that isn't yours to be try to make a few bucks. That's a recipe for disaster, and something that you should never do. If you want to get involved in crypto or any other sort of trading / investing, always be prepared to lose it all and BE ABLE to live on without the money.

So I do hope a good amount of people see this and get the memo, using margin is an easy way to lose a shit ton of money.
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April 21, 2018, 09:00:22 PM
 #12

Margin trading is just like a gambling that is why it's risky I remember when I was tried margin trading before sometimes I won sometimes which.

For me it's 50/50 that you can make profit or lose because in margin trading it always depends in your luck.

Unlike a real trading that you can hold them for a long time and sell them in the right time to make a profit.

If you know how to analyze the movement of the price margin trading is good, but there are times that you still need luck to make a good profit.

If you are planning to trade better to trade in exchanges than doing margin trading.

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April 21, 2018, 09:09:18 PM
 #13

Depending if you are just holding you can lose money as well. Imagine if you heald through 20k till 8k price. What would happen if you sold at 20k and bought back at 8k or even 6k you would earn much more in terms of how much bitcoin are you holding. To accumulate more is great if you can do it, that's why we should all learn how to pull great moves and profit as much as we can. Isn't it why we are here in the first place? Of course it is risky and provides good and bad exit but if you play the game well you could earn bog time.
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April 21, 2018, 09:19:18 PM
 #14

Margin trading is risky and is in no way suited to people who want to hold. The whole hold mentality only exists based on seeing past trends and knowing that bad spells of volatility are likely. Doing that with margin trading is a sure fire way to go broke.

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