Leverage
Trading with borrowed funds or margin so that a position controls more value than the collateral actually posted.
Leverage is expressed as a multiple of the collateral, so a position several times the size of the collateral gains and loses several times as fast in percentage terms. Venues require an initial margin to open and a maintenance margin to keep a position open; when equity falls below maintenance, the position is closed automatically. Isolated margin confines the collateral at risk to one position, while cross margin lets the whole account balance support it, which spreads risk differently rather than reducing it. Many offshore digital-asset venues offer leverage far above what regulated equity brokers may extend to retail clients, which is a structural reason forced closings are common in these markets.
实际应用
At ten times leverage, a ten percent adverse move erases the collateral behind the position, which is why liquidation is triggered before that point is reached.
常见的误解
Leverage multiplies position size, not staying power; a brief adverse move can close a position permanently well before any later recovery.