Margin Trading is a risky venture if not played responsibly you may lose more than you invested. But then how come individuals make a fortune out of it? While few of the investors argue that you have to compete against a bot to make profits, others recommend to sail cautiously, and be the turtle while trading, so whom to follow and whom to not?
Our today’s post would narrate some of the tips and tricks to follow while executing a cryptocurrency margin trade. Let’s get started –
Crypto Margin Trading Tip # 1
Start With Small Amount
It’s a good idea for a beginner to start with a small amount to minimize risks, by using a low level of leverage and avoiding using up of funds in one transaction. Crypto Margin Trade showcase a significant probability of “High Returns” but unless you know the nitty-gritty of the market, the technical indicators, the workflow, how to open and close margin positions, what are margin ratios and calls or even different margin trading strategy you may not be able to boost your returns.
Starting small help in experimenting and exploring the domain, and once you master the art of trading, you can expand your reach, adding more funds to your portfolio and receive success.
Crypto Margin Trading Tip # 2
Follow news and learn to decipher it
Crypto Market is highly volatile, till 2017 the price of Bitcoin reached till 20,000 and 2018 has seen a significant dip. All these price fluctuations have been influenced by some of the other events happening around the world, just for example when SEC rejected the ETF’s proposal or when China put a pause to Token Trading. As an investor interested in crypto margin trading you should know when to buy the rumor and when to sell the news. Striking the chord at the right time would make all the difference and make you a gainer or loser. So watch out the events and make smart decisions.
Crypto Margin Trading Tip # 3
One of the critical parts of managing risk with crypto margin trade is minimizing your loss. You may want to opt for a Stop loss order, so if you bought bitcoin at $9,000, you could set a stop loss order at $7,500. It would help in limiting your loss to $1,500. But again sail cautiously while using stop-loss as if you set a price too close to buying price, you may lose and put a stop occur before any profit is seen. Or if you select a broader range that could also result in substantial losses. Again learning and knowing the details about when and how to opt for the strategy would be a great help.
Crypto Margin Trading Tip # 4
Access online and Offline storage
Do not put all your eggs in one basket that simply means if you have a lot of cryptocurrency use online and offline wallets to protect them from hacking. Storing the significant cryptos in an offline wallet or cold storage is less risky and could help protect yours from unauthorized access of digital currencies.
Crypto Margin Trading Tip # 5
Spread buying options and platforms
Spread your wings that merely means spread out your buying options, i.e., in a matter of weeks or days. It helps in allowing you to analyze what is working and what isn’t and lowers the risk in case an investment turns against your expectations. Additionally, it provides you time to adjust to the new domain.
Even picking different platforms/exchanges would be a good idea to explore and analyze how and where you can maximize your returns.
While crypto margin trade involves adventure and excitement, it has its downtime as well. All you need to apply is caution, intelligence and baby steps.