How to Buy Long in Margin Markets

How to use margin to magnify gains if you think the price will go up?
Take BCH/USDT trading pair and up to 4X leverage supported as an example. If the price of BCH will rise from 200 USDT to 300 USDT and you have a principal of 2,000 USDT, then 6,000 USDT can be borrowed from the platform. You use 8,000 USDT to buy 40 BCH at the price of 200 USDT. If the price of BCH rises to 300 USDT, and you sell 40 BCH at the price of 300 USDT.

The profit is: 40 BCH*(300-200)=4,000 USDT. If you use your own 2,000 USDT to make spot trading, you can only make a profit of 1,000USD. But if you use 4X leverage to trade, the profit will increase 4 times.

Note: In order to simplify the calculation of the above process, the calculation of the borrowing fee is omitted.mceclip1.png

Description for Margin Trading Page:
1. Search bar and market area
2. Trading pair and basic market information
3. K-line market and depth chart
4. Fee discount setting and rate of maker & taker 
5. Margin introduction and market selection area
6. Margin trading pair information area
7. Order placing area
8. Proportion of buying & selling
9. Market handicap depth area
10. Trade history area
11. Current orders area
12. Orders history areamceclip0.png

 

If you judge the price of BCH will rise and long buy, you need to borrow USDT from the platform, and then use principles plus the borrowed USDT to buy BCH at a lower price. When BCH price rises to the expected price, you can sell it at a higher price, return the borrowed coins and interests to make profits. The detailed steps are as follows:

Step 1: Check trading pairs supported 

Step 2: Transfer assets to a margin account

Step 3: Borrow USDT

Step 4: Buy BCH at a lower price

Step 5: Sell BCH at a higher price

Step 6: Return the borrowed coins and interests

Step 7: Transfer margin assets to spot accounts

 

Take 100 USDT and 4X margin for long BCH as an example:

Step 1: Check trading pairs supported 

1. Visit CoinEx website www.coinex.com, and after successfully logging in your account, click [Exchange] on the top.mceclip1.png
2. Tick the [Margin] option in the market display area to check and select trading pairs supported, click [Margin Trading] in the market selection area.mceclip2.png

 

Step 2: Transfer assets to a margin account

Click [Transfer] on the margin trading page, select [From Spot Account to Margin Account], choose USDT coin type, set the [Amount] and click [Submit] to complete the transfer.mceclip10.png

 

Step 3: Borrow USDT

Click [Borrow], select [USDT (Long Buy)], check [Automatic renewal] (enabled by default), enter the loan [Amount] and click [Confirm] to complete the loan.

Reminder: When the principal is 100 USDT, and you borrowed 300 USDT, which means the total is 400 USDT. That is, the principal is increased 4X margin.mceclip6.png

 

Step 4: Buy BCH at a lower price. (Take a limit order as an example here)

Use 400 USDT to buy 1.6 BCH at a price of 250 USDT in the BCH/USDT margin trading market to complete the buy/long.mceclip7.png

 

Step 5: Sell BCH at a higher price. (Take a limit order as an example here)

If the price of BCH rises to 300 USDT, sell 1.6BCH in the BCH/USDT margin trading market to get 480 USDT for repayment.mceclip8.png

 

Step 6: Return the borrowed coins and interests

Click [Repay] on the margin trading page, select [USDT], enter [Paid amount] and click [Confirm] to complete the repayment.mceclip9.png

 

Step 7: Transfer margin assets to spot account

Click [Transfer] on the margin trading page, select [From Margin Account to Spot Account], choose [USDT] coin type, set the transfer [Amount] and click [Submit] to complete the transfer.________a276ba83-78be-48e4-a576-d834a322fe3c____.png

 

Conclusion:
In the above example, if the price of BCH will rise from 250 USDT to 300 USDT and you have a principal of 100 USDT, then 300 USDT can be borrowed from the platform in 4X margin. If you use 300 USDT to buy 1.6 BCH at the price of 250 USDT. If the price of BCH rises to 300 USDT, and you sold 1.6 BCH at the price of 300 USDT to get 480 USDT.

The profit is: 1.6 BCH*(300-250)=80 USDT. If you use your own 100 USDT to make spot trading, you can only make a profit of 20 USDT. But if you use 4 times leverage to trade, the profit will increase 4 times.

Note: In order to simplify the calculation of the above process, the calculation of the borrowing fee is omitted.

 

Risk warning:
Margin Trading not only allows you to magnify gains with fewer funds but can also saddle you with amplified losses when the market moves against you. Therefore, we strongly advise entry-level users not to use highly leveraged trading to avoid forced liquidation or even bankruptcy.

 

Related articles:

Margin Trading Risk Alert

Use CET as Transaction Fees

Spot & Market Orders

What is Maker & Taker?

Rules of Depth Merger

Rules of Minimum Order Limit

VIP Discount

Margin Trading Loan Interest Description