Leverage Trading

[Mauser]

Hello,
is there any difference between a trade with 5.000$ with 1x leverage and on the other hand 100$ with 50x leverage?
The only difference I see is the liquidation price of course. But is there any other differnce?
Thank you all, Frank

With leverage of 1 you probably mean a normal long position. You probably own the underlying asset directly and experience any change in price 1 to 1 in your portfolio. If there is a crash in the market the price will drop close to 0, but you can't lose more than your original 5000 USD. As for the 50x leverage here you probably don't own any underlying asset and just a contract that participates you on the price movement. The biggest issue for me is that your losses are not limited to the 100 USD investment. You could lose much more than that.

[MIner1448]

Taking into account the volatility of the market, your deposit of $ 100 with a leverage of x50 will not be enough to practically budge, let's say your rate has dropped at least from the original price by 1% - this is already 50 times of your deposit, most likely even up to 1% your rate will not go negative, your deposit liquidity will burn out on the way to this amount.

[VanityWallets2015]

I really do like this kind of topic from new traders, I was like that before whenever I don't understand things in trading from the materials I read online. Well I think it's two different thing just come to think of this, the higher the leverage the more risk you will get. So I think it's better to stick with the spot trading or explore the futures with a smaller amount.

[Ararbermas]

 The amount of profits you can make from using different leverage is the difference mate..$100-1x and 5k- 50x. Just compute both for you to know how much you can get on both trades.. And yes the liquidation as well because that's is futures trading mso better to understand the rules so that you're aware what will be the results.

[tygeade]

No difference unless you want to throw your $100 away, and which could have been better if saved in Bitcoin. Nothing great was built overnight.

If we look at when you posted your question, and the current mini-crash, I believe your $100 with 50x leverage gamble didn’t last you more than a day.

Unless he shorted it, there is shorting available as well and if you shorted at that time with 100 bucks and the price went low, then it would have been a over a thousand dollars depending on what type of leverage was used. I am not saying that leverage trading is great and all, we literally have a majority failing at spot trading so to expect that people could be great at leverage trading would be naive.

Unfortunately people can't keep their emotions out of trading and that results with bad situations which means if you put that into leverage people would be even more emotional and things going to end up not being so profitable and also psychologically a problem.

[Silberman]

Hello,
is there any difference between a trade with 5.000$ with 1x leverage and on the other hand 100$ with 50x leverage?
The only difference I see is the liquidation price of course. But is there any other differnce?
Thank you all, Frank

Do you need even more differences than that? When you use so much leverage the margin you have is paper thin and as soon as there is a small movement in the market that goes against your prediction then you will get a margin call, while in a trade in which you do not use leverage that same movement will barely affect your capital, it is clear to me you do not really understand the dangers of leverage so avoid using it for the time being.

[CryptoYar]

Just an example, you have $10 and took 5x leverage now If the trade goes according to your prediction then you will get 5x more profit. Same way if your trade/prediction goes wrong will face x5 lose.

And your trade will be open until your loss is $10 When your loss is $10 your trade will be closed automatically and the exchange will take their funds back.


Therefore, always respect your funds... And take low leverage and most importantly use stop loss

[Wind_FURY]

No difference unless you want to throw your $100 away, and which could have been better if saved in Bitcoin. Nothing great was built overnight.

If we look at when you posted your question, and the current mini-crash, I believe your $100 with 50x leverage gamble didn’t last you more than a day.

Unless he shorted it, there is shorting available as well and if you shorted at that time with 100 bucks and the price went low, then it would have been a over a thousand dollars depending on what type of leverage was used. I am not saying that leverage trading is great and all, we literally have a majority failing at spot trading so to expect that people could be great at leverage trading would be naive.

Trading with leverage is great, IF you’re part of the top 10% of profitable traders. Plebs don’t understand that the market is a war zone where there traders who are smarter than you, and work harder than you.

Unfortunately people can't keep their emotions out of trading and that results with bad situations which means if you put that into leverage people would be even more emotional and things going to end up not being so profitable and also psychologically a problem.

Or plebs are merely not good enough, just Buy the DIP and HODL.

[sumant]

Personally I love concept of leverage trading, it is really very dramatic. Your money is in loss or profit in very short time. As I have coverage myself leverage trading and sports betting these two program is not going to suit many people around world reason they can't control the emotions of getting big money in short time. If you are a patient trader then you can give a go to market and enjoy your ride.

[palle11]

Personally I love concept of leverage trading, it is really very dramatic. Your money is in loss or profit in very short time. As I have coverage myself leverage trading and sports betting these two program is not going to suit many people around world reason they can't control the emotions of getting big money in short time. If you are a patient trader then you can give a go to market and enjoy your ride.

Leverage trading is not for newbies because they don't understand what will be happening to their account when it starts going down. It is for well experienced traders who can also bear the risk. Leverage is good when on profit but if you start losing then you are on a free fall that you see you are empty. A small leverage is better than using high leverage and I don't advise newbies for it in any way.

[Wind_FURY]

Personally I love concept of leverage trading, it is really very dramatic. Your money is in loss or profit in very short time. As I have coverage myself leverage trading and sports betting these two program is not going to suit many people around world reason they can't control the emotions of getting big money in short time. If you are a patient trader then you can give a go to market and enjoy your ride.

This is why the top 10% of the very best traders are millionaires. There’s always a pleb like me who gets very excited in “the drama” of market volatility that top 10% of traders will take advantage of, and get profit from.

How many cycles more before they simply, Buy the DIP and HODL.

[RealMalatesta]

leverage trading and sports betting these two program is not going to suit many people around world reason they can't control the emotions of getting big money in short time.

Is there any reason to include sportsbetting here? Because, I am not seeing any relation between leverage trading and sportsbetting.

Even you are good in controlling your emotions, leverage trading may lead you to bite the dust as no market is predictable and these days bitcoin market is too wild in fluctuations even it got decent volume. So, dangers of leveraged trading will not get eliminated even you are able to manage your emotions effectively.

A small leverage is better than using high leverage and I don't advise newbies for it in any way.

Minimum leverage along with good technical analysis may get you profits but availing small leverage is not a problem for any trader but stronger technical analysis.

[mindrust]

Hello,
is there any difference between a trade with 5.000$ with 1x leverage and on the other hand 100$ with 50x leverage?
The only difference I see is the liquidation price of course. But is there any other differnce?
Thank you all, Frank

With 50x leverage, you'll get liquidated  50 times faster. Using leverage is often considered dangerous especially if you are not experienced because you are basically trading on borrowed money when you use leverage on your trades.

If you trade on 1x leverage, as long as the markets don't go to zero, you can't get liquidated. With 2x leverage, you get liquidated the moment markets drop 50%.

[wxa7115]

Hello,
is there any difference between a trade with 5.000$ with 1x leverage and on the other hand 100$ with 50x leverage?
The only difference I see is the liquidation price of course. But is there any other differnce?
Thank you all, Frank

No difference unless you want to throw your $100 away, and which could have been better if saved in Bitcoin. Nothing great was built overnight.

If we look at when you posted your question, and the current mini-crash, I believe your $100 with 50x leverage gamble didn’t last you more than a day.

I understand that sometimes people do not really understand what they are talking about but if they cannot see any difference between using more capital and no leverage on one hand and on the other using a very small amount of capital and a lot of leverage, then they could simple create two accounts in different exchanges, test their theory that there is no difference and then see how things work out.

And if they did that then they will soon realize that those 100 dollars will evaporate in an instant, while the account that was not using leverage just presented small losses, but for some reason something as simple as that never crosses their mind and instead derive conclusions without any evidence whatsoever about the validity of their claims.

[Wind_FURY]

Hello,
is there any difference between a trade with 5.000$ with 1x leverage and on the other hand 100$ with 50x leverage?
The only difference I see is the liquidation price of course. But is there any other differnce?
Thank you all, Frank

No difference unless you want to throw your $100 away, and which could have been better if saved in Bitcoin. Nothing great was built overnight.

If we look at when you posted your question, and the current mini-crash, I believe your $100 with 50x leverage gamble didn’t last you more than a day.

I understand that sometimes people do not really understand what they are talking about but if they cannot see any difference between using more capital and no leverage on one hand and on the other using a very small amount of capital and a lot of leverage, then they could simple create two accounts in different exchanges, test their theory that there is no difference and then see how things work out.

What the 90% of “traders” don’t truly understand is that the top 10% of traders, who are real professionals, WANT them to continue trading. The “traders” are their victims.

Do you want to be a victim? Or do you want to simply Buy Bitcoin, and HODL?

[sana54210]

I understand that sometimes people do not really understand what they are talking about but if they cannot see any difference between using more capital and no leverage on one hand and on the other using a very small amount of capital and a lot of leverage, then they could simple create two accounts in different exchanges, test their theory that there is no difference and then see how things work out.

What the 90% of “traders” don’t truly understand is that the top 10% of traders, who are real professionals, WANT them to continue trading. The “traders” are their victims.

Do you want to be a victim? Or do you want to simply Buy Bitcoin, and HODL?

Those professionals know what they are doing, they know that they have more money than others as well, and they know what they have to do to get the most out of the liquidity available as well.

If the price looks low at that moment and yet there are still a bit of price change allowing them to make profit, they could drop it even further to make that income, if there is a big short futures saved up, and just 1k+ going up makes them 100x more money than they will make sure to get that as well. Whatever whales do, they know what they are doing and checking the market and how people are positioned and smaller investors do not have that advantage because they lack the funds for it.

[Zilon]

Hello,
is there any difference between a trade with 5.000$ with 1x leverage and on the other hand 100$ with 50x leverage?
The only difference I see is the liquidation price of course. But is there any other differnce?
Thank you all, Frank

There is no difference at all both are obviously at the same risk proportion. Now if you look closely the liquidation price of both currency and the leverage choosed to trade both are almost of the same ratio meaning If the $5 trade uses 1x leverage because the account size is not capable of holding a trade for long it is bound to face a total wipe similarly to the $100 with 50x leverage because the account will open a single trade above the lot size it can carry

[Wind_FURY]

I understand that sometimes people do not really understand what they are talking about but if they cannot see any difference between using more capital and no leverage on one hand and on the other using a very small amount of capital and a lot of leverage, then they could simple create two accounts in different exchanges, test their theory that there is no difference and then see how things work out.

What the 90% of “traders” don’t truly understand is that the top 10% of traders, who are real professionals, WANT them to continue trading. The “traders” are their victims.

Do you want to be a victim? Or do you want to simply Buy Bitcoin, and HODL?

Those professionals know what they are doing, they know that they have more money than others as well, and they know what they have to do to get the most out of the liquidity available as well.

Their large capital, they can use that to make more trades than us, manipulate the market through stop-loss hunting, and to liquidate plebs who are trading with leverage. The plebs’ small capital allows him/her a smaller set/quantity of “moves”, a trader with hundeds of millions in trading capital allows a larger set/quantity of “moves”.

[abikobong]

Personally I love concept of leverage trading, it is really very dramatic. Your money is in loss or profit in very short time. As I have coverage myself leverage trading and sports betting these two program is not going to suit many people around world reason they can't control the emotions of getting big money in short time. If you are a patient trader then you can give a go to market and enjoy your ride.

Leverage trading is not for newbies because they don't understand what will be happening to their account when it starts going down. It is for well experienced traders who can also bear the risk. Leverage is good when on profit but if you start losing then you are on a free fall that you see you are empty. A small leverage is better than using high leverage and I don't advise newbies for it in any way.

Two words: risk management. Dont risk more than 1% per trade and no more than 5% per day, more leverage means more risk.
newbie lost from future trading due to not using stop loss.

[Wind_FURY]

Personally I love concept of leverage trading, it is really very dramatic. Your money is in loss or profit in very short time. As I have coverage myself leverage trading and sports betting these two program is not going to suit many people around world reason they can't control the emotions of getting big money in short time. If you are a patient trader then you can give a go to market and enjoy your ride.

Leverage trading is not for newbies because they don't understand what will be happening to their account when it starts going down. It is for well experienced traders who can also bear the risk. Leverage is good when on profit but if you start losing then you are on a free fall that you see you are empty. A small leverage is better than using high leverage and I don't advise newbies for it in any way.

Two words: risk management. Dont risk more than 1% per trade and no more than 5% per day, more leverage means more risk.
newbie lost from future trading due to not using stop loss.

Using that strategy, would a simple, inexperienced pleb like you or me outperform the basic strategy of buy the dip, and HODL? Bitcoin would profit you more than 10x from March of 2020, more if you bought the right shitcoin, but many leveraged traders either do not outperform, OR lose their money through liquidation.