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Margin Trading Guide
2022/03/04 20:23:18

Margin trading amplifies trading results so that traders are able to realize larger profits on successful trades. What you have to do to start the margin trading is to borrow token, then trade the token you want which can be a short position or long position. After that you can repay the borrowing token with interest. This is an article to explain borrowing token, trade, and repayment.

1. Borrowing

(1)  Log in to your FAMEEX account, go to the top of the website, find [Spot], then [Margin] in the navigation bar, clicking it then choose the trading pair. You may pick the trading pair you want.

Remarks: FAMEEX’s margin trading account is independent to the other accounts, which means if liquidation happens in margin trading, other assets in other accounts would not be affected.

(2) On margin trading page, you may find “Transfer” on the right, and you are able to transfer assets from other accounts into margin trading accounts as margin, or you may go to [Assets]-[Margin Wallet], click [Transfer].

(3) Fund transfer windows will pop up by clicking the [Transfer], choose the token, insert transfer amount, then click “confirm”. Your token will be transferred from the other accounts to margin wallet.

(4) Assets have been transferred as Margin (Collateral). You can start to borrow token. You can go to margin trading page, then click [borrow] on the right, or you may borrow token in [My Assets]-[Margin Wallet], click [borrow].

(5) [borrow] windows will pop up by clicking [borrow], then you can enter all the information needed such as, trading pair, coin, and quantity. The maximum loanable amount will be shown, then you just need to borrow the amount you want.

You will be borrowing less amount of token if platform does not have sufficient amount to lend. If our platform has sufficient amount of token to lend, then the quantity you requested will be successfully arrived to your wallet.

Remarks: Borrowing hourly rate may vary, the actual interest will be shown on the page.

(6) You can check your borrowed amount in [My Assets] – [Margin Wallet], after your loan is confirmed.

(7) On Margin Trading, you can check the borrowing time, hourly rate and interest repayment record.

Remarks: Every token has its own minimum borrowed amount and maximum loanable quantity. If the value of its collateral is too small, the loanable amount might be less than the minimum amount, so you will fail to borrow, you have to transfer sufficient token as collateral.

The above procedures are the first step – Borrow.

2. Margin Trading

When you complete the borrowing procedure, you can start trading, which involves long and short position.

(1) [Open Long], BUY means open long position, in that case you are expecting the price will rise. You borrow token by putting your assets as a collateral, then you buy in and wait for the price to go up. At that time, you sell it off, repay the token and make the profit.

Opening a long position requires to borrow USDT from FAMEEX, because you need to buy the specific assets which you expect to rise with USDT.

For Example, BTC/USDT:

a. On margin trading page, you may choose [Limit], [Market], [Stop Limit] and [Trailing Stop] orders to buy the token you want.

b. When the price goes up to the price level you expected, you may select one of these orders to sell your token and capture the profit.

c. Buy the specific token that you borrowed at low price level, then you sell it at high price level, after that you repay both the interest and the principal, the larger price difference, the higher profit you can make.

(2) [open short], sell is equivalent to opening short position, which means you predict the price will fall. You make a loan by transferring your assets to margin wallet as a colleteral, then you sell the token at high price level, after that you can buy it back at low. You return the token you borrowed, the profit would be the price difference.

Selling requires you to borrow token from the platform, in this case, it would be BTC. Borrowing BTC from the platform, then sell it at high price level. You can make profit from the trade when you buy BTC back at low.

For example, BTC/USDT,

a. On margin trading page, you may choose [Limit], [Market], [Stop Limit] and [Trailing Stop] orders to buy the token you want.

b. When the price fall to the price that you predicted, you can choose to trade by using [Limit], [Market], [Stop Limit] and [Trailing Stop] orders.

c. Selling the borrowed token at a high price level, then you buy it back at low, and repay the borrowed token and repay the interest. Your profit would be higher if the price difference is larger.

Remarks: Margin trading amplifies the results of your investment. The profit could be larger, but the loss could also be larger, which solely depends on your prediction. If you are a crypto beginner, you may consider not to engage in any margin trading, preventing losses or even liquidation.

3. Repayment and Interest

(1) When you plan to repay the borrowed token and the interest, you may go to [Spot] – [Margin], clicking the [Repayment] on the left, or you can find repayment in repayment record, or you may go to [Assets] – [Margin Wallet], click [Repayment].

In the repayment record (Return), you may filter each borrowing record. When you repay the token, you repay both the interest and the principal.

(2) By clicking [Return], Please insert the correct information including numbers of token and token and pair. After confirmation, please click confirm repayment. If you realize that you don not have sufficient amount of token to repay the loan, please transfer the token to your margin wallet to proceed the repayment.

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