AscendEX Margin Trading Notes

Understanding margin trading fundamentals is crucial before delving into the comprehensive guide provided by AscendEX for profitable and risk-mitigated trades.

Nov 25, 2024 at 04:48 am

AscendEX Margin Trading Notes: A Comprehensive Guide

Margin trading is a powerful tool that can amplify profits, but it also comes with risks. In this guide, we will provide comprehensive notes on margin trading on AscendEX, covering everything from getting started to advanced strategies.

Prerequisites

Before you can start margin trading on AscendEX, you need to:

• Create an AscendEX account and complete the KYC verification process.
• Fund your account with supported cryptocurrencies.
• Enable margin trading in your account settings.

Steps:

1. Getting Started with Margin Trading

• Understand the Basics: Margin trading involves borrowing funds from the exchange to increase your trading position. You can borrow up to 5x leverage on AscendEX.
• Choose a Trading Pair: Select a trading pair that you want to trade with margin. AscendEX supports margin trading for a wide range of cryptocurrencies.
• Set Your Leverage: Determine the amount of leverage you want to use. Higher leverage amplifies both profits and losses.

2. Opening a Margin Position

• Place an Order: Create a market or limit order to open a margin position. Specify the order type, trading pair, quantity, and leverage.
• Confirm the Order: Review the order details and ensure that everything is correct before confirming the order.
• Monitor Your Position: Track the performance of your margin position regularly and adjust your strategy as needed.

3. Margin Call and Liquidation

• Margin Call: When your account balance falls below a certain threshold, AscendEX will issue a margin call. You will need to deposit additional funds or close your position to meet the margin requirement.
• Liquidation: If you fail to meet a margin call, AscendEX will automatically liquidate your position. This means that your assets will be sold to cover the borrowed funds.

4. Closing a Margin Position

• Place a Closing Order: Create a market or limit order to close your margin position. Specify the order type, trading pair, and quantity.
• Confirm the Order: Review the order details and ensure that everything is correct before confirming the order.
• Settle the Position: Once the order is filled, your margin position will be closed. Any profits or losses will be credited to your account.

5. Risk Management

• Use Stop-Loss Orders: Place stop-loss orders to limit potential losses in case of adverse market movements.
• Monitor Market Conditions: Stay informed about market trends and news that may impact your margin positions.
• Manage Your Leverage: Use leverage cautiously and only borrow funds that you can afford to lose.

6. Advanced Strategies

• Cross Margin Trading: Cross margin trading allows you to use the combined balance of all your margin positions as collateral.
• Isolated Margin Trading: Isolated margin trading limits the risk to a specific margin position.
• Hedging: Use margin trading to hedge against price fluctuations in other positions.