Toobit USDT-margined futures support both isolated margin and cross margin modes. Each offers different advantages depending on your trading needs.
With isolated margin, margin is allocated to individual positions, allowing you to manage the risk of each trade separately. With cross margin, positions share available margin, providing greater flexibility in how your funds are used.
Isolated margin: Manage risk for individual positions
In isolated margin mode, the margin and profit or loss of each position is calculated separately. If a position is liquidated, only that position is directly affected, while your other positions remain unaffected by that liquidation.
Example:
You have 1,000 USDT in your USDT-margined Futures Account and allocate 200 USDT as margin for an isolated BTCUSDT perpetual futures position.
If the position is liquidated, your loss is generally limited to the 200 USDT allocated to it. The remaining 800 USDT will not automatically be used to maintain the position.
Cross margin: Share margin across positions
In cross margin mode, positions share the available USDT margin in your USDT-margined Futures Account. Your account's margin ratio is calculated based on your account balance and the combined profit and loss of your cross-margin positions. This allows available funds to support multiple positions rather than allocating margin to each one separately.
Example:
You have 1,000 USDT in your USDT-margined Futures Account and open a BTCUSDT perpetual futures position in cross margin mode, with an initial margin requirement of 200 USDT.
If the position incurs an unrealized loss, the remaining available USDT can help maintain it. If you also hold an ETHUSDT cross-margin position, the profit and loss of both positions will affect your account's margin ratio.
Things to keep in mind
1. In cross margin mode, continued losses on one position may deplete your available USDT and affect other cross-margin positions. In extreme market conditions, your entire USDT-margined futures account balance may be at risk.
2. In isolated margin mode, margin is allocated separately to each position. However, if auto margin addition is enabled, the system may add funds from your available account balance to maintain a position, increasing the amount at risk.
Reminder: Isolated margin helps limit risk to individual positions, while cross margin allows available funds to support multiple positions. Whichever mode you choose, monitor your margin ratio, unrealized profit and loss, and estimated liquidation price to manage your positions effectively.
