If you're going to use leverage, you should understand how it works.
Using leverage allows you to increase the size of your trade.
Traders like using leverage because it can increase gains. But there are downsides too.
When using leverage, you only need to deposit a percentage of the overall position size.
The higher the leverage, the less you contribute and the more you borrow proportionally.
Can you take a big loss? Increasing position size increases the size of potential losses.
On top of this, generally the higher your leverage, the higher your liquidation risk.
Also - don't forget using leverage incurs regular fees which can reduce your balance over time.
How can you use leverage safely?
Be careful and control your risk. Leverage is a tool for experienced traders.
Here are some tips 👇
Learn more about leverage and Futures with #Binance Academy👇
academy.binance.com/en/articles/th…
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