Future trading without leverage

[Oshosondy]

Presently I have preferred to just trade without leverage, using leverage means you can use your trading asset to serve as collateral to borrow more funds for trading, but what if you open a position with 1x leverage?

I have preferred to use 1x leverage because if I open a long position with 1x, the liquidation price is just infinity, unless the trading site wanted to delist the coin among the coin that you can use for future trading.

It is clear that if I use 2x leverage or higher, money is borrowed, used for trading, there will be a percentage that I will pay per hour according to the terms and conditions. Using higher leverage is discouraging because of liquidation and if someone want to open a position for long, like 3 months or more.

What about 1x, I think no collateral involved at all? Which means nothing to be paid than trading fee?

[mk4]

As far as I know there's no point in using leverage if you're just going to use 1x (1x leverage is virtually pretty much just buying spot), because you're going to pay the hourly funding rates anyway. The only logical reason to use 1x leverage is if you're shorting.

[logfiles]

I have preferred to use 1x leverage because if I open a long position with 1x, the liquidation price is just infinity, unless the trading site wanted to delist the coin among the coin that you can use for future trading.

Who lied to you. If you open a Bitcoin position right now at 1x Leverage.
Longing right now will get you a liquidation price of around $148
Shorting right now will get you a liquidation price of around $59,000

What about 1x, I think no collateral involved at all? Which means nothing to be paid than trading fee?

Borrowing is still involved. Anything to do with Leverage means you are borrowing, and you are using the asset you have in the futures account as collateral. If the market goes extremely opposite, your position will get liquidated. Do not be misled

[teosanru]

Presently I have preferred to just trade without leverage, using leverage means you can use your trading asset to serve as collateral to borrow more funds for trading, but what if you open a position with 1x leverage?

I have preferred to use 1x leverage because if I open a long position with 1x, the liquidation price is just infinity, unless the trading site wanted to delist the coin among the coin that you can use for future trading.

It is clear that if I use 2x leverage or higher, money is borrowed, used for trading, there will be a percentage that I will pay per hour according to the terms and conditions. Using higher leverage is discouraging because of liquidation and if someone want to open a position for long, like 3 months or more.

What about 1x, I think no collateral involved at all? Which means nothing to be paid than trading fee?

Future traders generally don't keep positions open for more than a period of 3 months because generally the contracts expire in 3 months so at Max you will see them trading just for a few days or weeks only. And the reason why people prefer leverage is because it obviously increases your capital and the rate of return at the same time and experienced traders generally practice a healthy stop loss as well so liquidation isn't really a major issue for them.

[Oshosondy]

As far as I know there's no point in using leverage if you're just going to use 1x (1x leverage is virtually pretty much just buying spot), because you're going to pay the hourly funding rates anyway. The only logical reason to use 1x leverage is if you're shorting.

Assuming you are having USDT or USDC, you can open a long position for bitcoin, if the price of bitcoin increase, you gain, that is where your point is valid. But you can open short position, if bitcoin price decrease, you gain, that is why future trading is different from spot trading, it is not only about the leverage.

Who lied to you. If you open a Bitcoin position right now at 1x Leverage.
Longing right now will get you a liquidation price of around $148

No, but maybe exchanges differs. I use Binance and OKX, the liquidation price for 1x leverage used to open a long position is infinity, no price stated unlike using more than 1x. I can do it and snap it for you to see.

Borrowing is still involved. Anything to do with Leverage means you are borrowing, and you are using the asset you have in the futures account as collateral. If the market goes extremely opposite, your position will get liquidated. Do not be misled

I will still agree to this, but you money can not be liquidated with 1x long, the problem here is for the exchange to delist such coin which will result to automatic refund with losses.

[logfiles]

I will still agree to this, but you money can not be liquidated with 1x long, the problem here is for the exchange to delist such coin which will result to automatic refund with losses.

You are joking with markets, brother.

You could say this with BTC because reaching $148 would take some time, but it's not impossible. I say this as a true believer of Bitcoin, but when it comes to markets, anything can happen.

Look at the case of Luna, for example

When the price was at let say $90
Long on 1x Leverage ---> Liquidation price $1.8

How much is LUNA's price again right now after the dramatic crash? $0.000096

[Oshosondy]

You are joking with markets, brother.

You could say this with BTC because reaching $148 would take some time, but it's not impossible. I say this as a true believer of Bitcoin, but when it comes to markets, anything can happen.

Look at the case of Luna, for example

When the price was at let say $90
Long on 1x Leverage ---> Liquidation price $1.8

How much is LUNA's price again right now after the dramatic crash? $0.000096

I am confused, are the exchanges faking it and just do not indicate the liquidation price, make people to think it is infinity?

Luna is one of its kind that is uncommon, bitcoin can never be like that.

I got luna at the time but it was only liquidated when Binance delisted it from future trading.

[logfiles]

I am confused, are the exchanges faking it and just do not indicate the liquidation price, make people to think it is infinity?

Luna is one of its kind that is uncommon, bitcoin can never be like that.

I got luna at the time but it was only liquidated when Binance delisted it from future trading.

Just for clarity, I am using Bybit and FTX mostly. I trade on Binance too. They show "there is no liquidation price For a time being" I hope you know what that means  

I shorted LUNA on Binance until my position was closed by the ADL engine, that was before they delisted it. Luna, may have been one of a kind, but it does not mean it can not happen again.

This is a fact. "You can get liquidated if the Bitcoin price drops drastically below the liquidation price"

[Oshosondy]

Just for clarity, I am using Bybit and FTX mostly. I trade on Binance too. They show "there is no liquidation price For a time being" I hope you know what that means 

I shorted LUNA on Binance until my position was closed by the ADL engine, that was before they delisted it. Luna, may have been one of a kind, but it does not mean it can not happen again.

This is a fact. "You can get liquidated if the Bitcoin price drops drastically below the liquidation price"

Thank you very much, I have just understood what you are saying, even also if a coin got to an extent of price fall or depreciation, it is normal that that the coin have no value again, but the less risky position for liquidation is still 1x long position, but for bitcoin because I do not trust altcoin. I think it is not also good to open a position for long which is what I want to get from this thread.


Thank you all that contributed.

[bitcub]

If you are trading in futures by using 1x leverage it is like trading in spot. The only advantage in futures is if you want to short. Yes you can even short using 1x leverage but theres a fee.

Presently I have preferred to just trade without leverage, using leverage means you can use your trading asset to serve as collateral to borrow more funds for trading, but what if you open a position with 1x leverage?

I have preferred to use 1x leverage because if I open a long position with 1x, the liquidation price is just infinity, unless the trading site wanted to delist the coin among the coin that you can use for future trading.

It is clear that if I use 2x leverage or higher, money is borrowed, used for trading, there will be a percentage that I will pay per hour according to the terms and conditions. Using higher leverage is discouraging because of liquidation and if someone want to open a position for long, like 3 months or more.

What about 1x, I think no collateral involved at all? Which means nothing to be paid than trading fee?

[mk4]

As far as I know there's no point in using leverage if you're just going to use 1x (1x leverage is virtually pretty much just buying spot), because you're going to pay the hourly funding rates anyway. The only logical reason to use 1x leverage is if you're shorting.

Assuming you are having USDT or USDC, you can open a long position for bitcoin, if the price of bitcoin increase, you gain, that is where your point is valid. But you can open short position, if bitcoin price decrease, you gain, that is why future trading is different from spot trading, it is not only about the leverage.

You probably misread my response. My point that there's no point having a 1x leverage long position if you can just simply buy spot because of the funding. You even corrected me with shorting even when I mentioned it lmao.

[AicecreaME]

As far as I know there's no point in using leverage if you're just going to use 1x (1x leverage is virtually pretty much just buying spot), because you're going to pay the hourly funding rates anyway. The only logical reason to use 1x leverage is if you're shorting.

I agree.

x1 is not even a leverage especially in futures, because you're like trading in stocks that way, even though your margin is big. I mean, why trade in futures if you're just gonna do x1 leverage, right? The most small leverage I've seen is x3 by pro traders with big margin, mostly this entry is for the long run trade. Chances of making more profits is wasted for sure when you're just gonna put x1 in your leverage.

[GreatArkansas]

Do spot trading instead of using 1x leverage trading.
There's no point to use leverage for me if you only use 1x. And for me, it's safer and less cost when using spot trade than using leveraged trades.
For me, the only effective when using 1x leverage is when you want to short the market because there's no spot for shorting unless some special spot market pair, like BITCOINBEAR on FTX where the price of that pair is increasing if BITCOIN is pumping.

[joeperry]

This topic is good as I personally don't know the difference between using spot trading and x1 leverage and I didn't have the chance to search about it but luckily there's this topic. I only use x1 mostly if I see that the coin is in downwards or downwards reversal as there is no coin for other coin such as BTCDOWN, though this BTCDOWN have different leverage than x1 leverage so I to keep it safe I use x1 leverage if I am going short.

[GelatikKembar]

without leverage? are you kidding? if without leverage is option trading mate,
because where there is futures trading there will be leverage, it has been inherent since the first,
because futures trading makes trading more manageable risk itself.

[wiss19]

I don't quite understand, not a pro but from the little knowledge I have about trading, futures at 1x leverage is simply trading spot, no? In fact you are going to have to pay the interest rate for no reason because you didn't take any benefit from that 1x leverage.

One reason could be because you are shorting some coin knowing the price is about to drop? Such as in the case of Luna then it makes sense but otherwise, there is no reason to use 1x leverage.

You get a better liquidation price and hence more safety indeed but you have interest on your head even when you haven't borrowed any amount technically.

[Mpamaegbu]

As far as I know there's no point in using leverage if you're just going to use 1x (1x leverage is virtually pretty much just buying spot), because you're going to pay the hourly funding rates anyway. The only logical reason to use 1x leverage is if you're shorting.

Exactly! It makes no meaning trading future with that leverage, apart from making it obvious that the trader is scared shit of losing. Future trading is like driving on the highway. Learners don't drive there. I like spot trading and taking things slowly. I don't get to lose anything with it, except my patience. Trading demands patience and every trader should know and inculcate that in their minds.