Margin supports the trade
Eligible collateral provides the equity that supports a leveraged position.
LEVERAGE TRADING GUIDE
MARGIN / POSITION SIZE / LIQUIDATION
Understand crypto leverage before using it.
Leverage can increase exposure beyond the collateral committed to a position. That can make capital more efficient for experienced traders, but it also means adverse price moves can create losses faster and may trigger liquidation.
LEVERAGE RISKMARGINLIQUIDATIONWALLET-FIRST
CORE CONCEPTS
Read the full position, not only the leverage number.
Leverage, collateral, position size and liquidation level work together. The same leverage multiple can represent very different risk depending on position size, volatility and the amount of available margin.
Leverage increases exposure
A leveraged position can be larger than the collateral backing it.
Losses can accelerate
Because exposure is larger, percentage moves in the market can have a larger effect on account equity.
Positions can be closed automatically
If margin falls below required levels, the market may liquidate all or part of the position.
Fast markets matter
Sharp price moves can reduce the time available to react, especially at higher leverage.
Verify every order
Check market, side, size, leverage and displayed risk information before submission.
BEFORE TRADING
Build a risk checklist before opening a leveraged position.
ORDER DETAILS
Confirm what you are opening.
MARKETCorrect trading pair
Make sure the market and contract are the ones you intended.
SIDELong or short
Confirm the direction before the order is sent.
SIZETotal exposure
Look at position size together with leverage and collateral.
RISK DETAILS
Know what can close the trade.
LIQUIDATIONDisplayed liquidation information
Understand where the position may become vulnerable to forced closure.
FUNDINGRecurring market costs
Perpetual markets may include funding payments that affect holding cost.
EXITPlan the close
Know how to reduce or close exposure before opening it.
RELATED TRADING GUIDES
Learn the mechanics around leveraged trading.
LEVERAGE FAQ
Quick answers.
What is leverage in crypto trading?+
Leverage increases market exposure relative to collateral, magnifying both potential gains and potential losses.
Can leverage cause liquidation?+
Yes. A position can be liquidated if losses reduce margin below the market's required level.
Does higher leverage mean higher risk?+
Generally, higher leverage leaves less room for adverse price movement before margin becomes stressed.
TRADE WITH CONTEXT
Open HOODBTC Trade ↗Understand leverage before using it.
Review the live market and every risk parameter before authorizing a trade.