@@cryptoforcanadians At 2:15. If I'm not mistaken instead of 1.05 you need to be mentioning 1.18 based on 3x leverage (as per slide at 1:00). Anyway, wonderful video and for new traders like me most informative! Thanks why I cared to comment (as you're helping us for free)
I think you're right I did make a mistake. I believe the assets would need to drop to 1000*1.05 = $1,050 for you to get liquidated, not $2100. I think I made a follow up video to this one with the correct calculations.
Can I get some clarification on margin trading? Say I have $100 and I isolated margin trade at 10x meaning I now have $1100 (lender has given me $1000). If I were to get liquidated, do I basically lose my $100 and the $1000 is repaid to the lender?
Please help me this question What is I'm have a $100 dollar account and use 10x leverage which is $1000 for a trade and the trade went negative , I'm I going to get stop out if my negative balance reach $100 or will it reach $1000 negative before stopping me out
Can you explain liquidation on Binance for cross margin trading shorting? Say I have 100 USD and I short 100 USD worth of BTC. How much can BTC's price drop as a percentage before I get liquidated?
You don't get liquidated when the price goes down on shorting only when it goes up. That would depend on how long that short has been opened for because of interest and what the margin requirements are. If you're unsure of how shorting works, don't do it IMO.
@@cryptoforcanadians Opps. I meant to say rise. I know about shorting. I just don't understand how to calculate maximum drawdown for liquidation for Binance. They make it confusing with their margin level instead of maintenance margin. Assuming no interest rates, how do I calculate the maximum drawdown I can incur?
If i add margin to an open position and i made a loss without hitting liquidation would only my position size be agfected or both my added margin to the position
They charge interest on it, regardless of whether you make money or not, that's how they benefit from it. Pretty much same ideas as a bank lending you money.
@@cryptoforcanadiansis it safer to open a future trade $50, 200X leverage with more money in my account even if I have a SL at $50. Than if I only have $50 in my account and open that trade?
i ask myself how true is what you are saying since how should i know if i try to learn something that i do not know. but i have a feeling you got it right and therefore you thought me right by watching this video, so thanx a lot ✌i would say you explained it beautifully 👌
So comparing your 10x v 5x leverage calculation examples - you're more likely to get liquidated at 5x leverage since the liquidation price is higher. I'm confused, how does that work?
Please help me this question What is I'm have a $100 dollar account and use 10x leverage which is $1000 for a trade and the trade went negative , I'm I going to get stop out if my negative balance reach $100 or will it reach $1000 negative before stopping me out
So if I have $100 but only put $20 on the trade at 10x leverage which equals $200, what's the difference between that vs putting $2 at 100x leverage which also equals $200?
No difference in that case. It would be the same because your collateral is $100 but you're in a $200 position. You've basically just 2xed your initial capital which means that if you're down roughly 50% on your position, you'll get liquidated. Hope that makes sense!
@@cryptoforcanadians Okay thank you for the clarification! So would you say that it's a little better to just do isolated higher leverage with a lower amount on the trade, since they both get liquidated at the same 50%? Or does the 100x still happen quicker/easier?
If i select isolated margin if I'm about to be liquidate if fund my wallet will i still get liquidated or does this only works on cross margins what to Know wether it applies to every margins please
@@cryptoforcanadians I just got liquidated of 1800$ if I knew this I could have added up more money into my wallet but do I have to move the funds to unified trading after funding my wallet sir
If the coin drops 50%, you'll be liquidated. This also doesn't account for margin interest that you'll be paying so the drop would be even lower than 50% so keep that in mind.
Hi, I'm not sure I understood it exactly, can you tell me if I have 80$ and buy BTC at 27,900$ with a 50:1 leverage, how much would BTC have to drop for me to get margin called?
Binance's Risk Ratios: www.binance.com/en/support/faq/7fbadf3c75914efc90e8b831709b644f
Thank you for the clear and concise explanation on margin call on liquidation! This was super helpful!
Thanks for the positive feedback! Glad the video was helpful!
Now I understand how liquidations work - thx!
Glad to help!
Mistake? Example based on 3x leverage ($1000+$2000) but 1.05 ratio used ( as per 10x leverage in table)
What’s the time on the video that you’re referring to?
@@cryptoforcanadians At 2:15. If I'm not mistaken instead of 1.05 you need to be mentioning 1.18 based on 3x leverage (as per slide at 1:00). Anyway, wonderful video and for new traders like me most informative! Thanks why I cared to comment (as you're helping us for free)
I think you're right I did make a mistake. I believe the assets would need to drop to 1000*1.05 = $1,050 for you to get liquidated, not $2100. I think I made a follow up video to this one with the correct calculations.
I like the way you explain things!
Is it possible to trade on Binance without Margin? Or would that just straight up be spot trading
Thanks! I appreciate the support. Margin trading uses the spot market but you’re borrowing. You can trade spot and not borrow.
@@cryptoforcanadians thanks!
Thank you ! Very useful.
Thanks! Glad you think so!
Can I get some clarification on margin trading? Say I have $100 and I isolated margin trade at 10x meaning I now have $1100 (lender has given me $1000). If I were to get liquidated, do I basically lose my $100 and the $1000 is repaid to the lender?
Pretty much that's how it works. You would lose the $100 and the $1000 would be paid back automatically to the lender.
Thanks for that and thanks for the quick response. Getting started in Margin Trading. This helps a lot.@@cryptoforcanadians
For sure! Glad to help out!
that's about right but 10x 100 would mean they lend you 900!
Please help me this question
What is I'm have a $100 dollar account and use 10x leverage which is $1000 for a trade and the trade went negative , I'm I going to get stop out if my negative balance reach $100 or will it reach $1000 negative before stopping me out
Can you explain liquidation on Binance for cross margin trading shorting? Say I have 100 USD and I short 100 USD worth of BTC. How much can BTC's price drop as a percentage before I get liquidated?
You don't get liquidated when the price goes down on shorting only when it goes up. That would depend on how long that short has been opened for because of interest and what the margin requirements are. If you're unsure of how shorting works, don't do it IMO.
@@cryptoforcanadians Opps. I meant to say rise. I know about shorting. I just don't understand how to calculate maximum drawdown for liquidation for Binance. They make it confusing with their margin level instead of maintenance margin. Assuming no interest rates, how do I calculate the maximum drawdown I can incur?
@@anon-842 When your debt = same value as your assets. If you put in $100 and your position becomes -$100 then that's when you'd get liquidated.
If i add margin to an open position and i made a loss without hitting liquidation would only my position size be agfected or both my added margin to the position
If you add margin to an open position, it will lower your liquidation price. You will then also have more funds to use as collateral.
So what benefit is the company getting by lending money? Is it like if i close the trade with a profit the company takes a percentage of it?
They charge interest on it, regardless of whether you make money or not, that's how they benefit from it. Pretty much same ideas as a bank lending you money.
@@cryptoforcanadians nice. Thanks for the answer btw
Sure thing!
So if you get a margin call, you can avoid getting liquidated if you add to the position to increase the overall value of the position?
You would need to add more collateral, i.e. fund more in your account, not add to that position.
@@cryptoforcanadiansis it safer to open a future trade $50, 200X leverage with more money in my account even if I have a SL at $50. Than if I only have $50 in my account and open that trade?
for LONG if we need to 0 liquidation then we have put same amount as size but what about SHORT if we need to have 0 liquidation?
If you don't want to get liquidated, just make sure that the amount you've borrowed doesn't exceed the amount of assets that you have.
i ask myself how true is what you are saying since how should i know if i try to learn something that i do not know.
but i have a feeling you got it right and therefore you thought me right by watching this video, so thanx a lot ✌i would say you explained it beautifully 👌
Thanks!
So comparing your 10x v 5x leverage calculation examples - you're more likely to get liquidated at 5x leverage since the liquidation price is higher. I'm confused, how does that work?
No, the higher the leverage the less of the % the coin has to drop before getting liquidated.
Please help me this question
What is I'm have a $100 dollar account and use 10x leverage which is $1000 for a trade and the trade went negative , I'm I going to get stop out if my negative balance reach $100 or will it reach $1000 negative before stopping me out
If the balance of your trade goes to just above $900 (10% drop), you'll get liquidated.
So if I have $100 but only put $20 on the trade at 10x leverage which equals $200, what's the difference between that vs putting $2 at 100x leverage which also equals $200?
No difference in that case. It would be the same because your collateral is $100 but you're in a $200 position. You've basically just 2xed your initial capital which means that if you're down roughly 50% on your position, you'll get liquidated. Hope that makes sense!
@@cryptoforcanadians Okay thank you for the clarification! So would you say that it's a little better to just do isolated higher leverage with a lower amount on the trade, since they both get liquidated at the same 50%? Or does the 100x still happen quicker/easier?
@@QTMGaming It really depends on your account balance.
@@cryptoforcanadians Okay thank you!
Sure thing!
If i select isolated margin if I'm about to be liquidate if fund my wallet will i still get liquidated or does this only works on cross margins what to Know wether it applies to every margins please
If you add funds to your account, your liquidation price lowers as you've got more margin/collateral.
@cryptoforcanadians even if I'm on isolated margin right
@johntochukwu2258 yes
@@cryptoforcanadians I just got liquidated of 1800$ if I knew this I could have added up more money into my wallet but do I have to move the funds to unified trading after funding my wallet sir
Sorry to hear that. You need to have the funds in your margin/futures account for it to count as collateral. Now you know for next time.
Sir would it be fine If i use small leverage like 2x and leave them till bullrun rather than spots holding?
If the coin drops 50%, you'll be liquidated. This also doesn't account for margin interest that you'll be paying so the drop would be even lower than 50% so keep that in mind.
Why my liquidation price changes
Because your collateral's value also changed.
how to see your liquidations ?
Like your past liquidations?
@@cryptoforcanadians yup
@TheRealHawKing depends on the exchange but my guess is you would look at your history? I’ve never been liquidated before so I can’t say for sure.
Hi, I'm not sure I understood it exactly, can you tell me if I have 80$ and buy BTC at 27,900$ with a 50:1 leverage, how much would BTC have to drop for me to get margin called?
The price of BTC would have to drop just over 2% because of margin requirements. So that would be about $27500 is my estimate. Not financial advice.
@@cryptoforcanadians Yes, I checked and it's about 1.65% after fees from the platform and so on, thank you!
My pleasure!