Cryptocurrency has gone a long way since its inception. As the industry developed over the years, crypto’s volatility went down significantly.
In the second half of 2018, there has been little volatility in September through November. Many traders assume that there’s no profit to be made when trading on Monfex. However, that assumption is far from the truth.
This is where the brokers and exchanges that support leverage trading comes in. By trading at a 10x, 50x, 100x leverage, you can make a profit in the market regardless of volatility.
Understand leverage trading
Before we can talk about Monfex, let’s explain the basics of leverage trading.
Here’s an example of how leverage trading works. Let’s say an investor has $1,000 in cash to trade with. With exchanges like Binance, you would buy a coin worth $1,000—and if its price increases by 10%, you’ve gained a $100 profit.
With leverage trading, you’ll be trading at a 10x leverage. This means that if you invest $1,000 and the price increases by 10%, then you’ll have a profit of $1,000. At 10x leverage, you’re holding $10,000 worth of the coin—so you’ll either gain a large profit or a huge loss based on the future value of the coin you’re trading.
Does this sound too good to be true? Not at all. Because if the 10x leverage price falls below 10%, you’ll lose the entire $1,000. This is a high risk, high-reward type of trading, which is why a lot of experienced investors prefer leverage trading.
The difference between Monfex and BitMex
- BitMex is