Leverage

Glossary · Derivatives

Leverage lets a trader control a position larger than their capital by borrowing against margin: 10x leverage turns ₹10,000 into ₹1,00,000 of exposure. It multiplies gains and losses equally, and shrinks the distance to liquidation — at 10x, a move slightly under 10% against the position ends the trade.

"Borrowed size — it makes your wins bigger, your losses faster, and your liquidation closer."

Leverage divides your distance to zero. Same idea, same account: at 3x, liquidation sits roughly 30% away and normal volatility can breathe; at 25x it's under 4% — closer than the average daily range of most majors, so time alone can kill the trade. The honest sizing order is backwards from how retail does it: find where the idea is invalidated first, place the stop there, then choose the leverage that keeps liquidation safely beyond the stop. Leverage should follow the trade, never lead it.

The quiet edge against you isn't the multiplier — it's that fees, funding, and spread all scale with position size while your account doesn't. A 50x trader paying taker fees both ways burns around 0.1% of notional per round trip, which is 5% of margin before the chart moves a tick. And every liq price is a dot on the map: a crowd levered 25x from the same breakout builds a liquidity pocket that tends to get visited. Small leverage with a real stop out-survives big leverage with a prayer, and surviving is the whole game.

Check what your leverage costs

Related jargon

Questions

What is Leverage in crypto trading?

Leverage lets a trader control a position larger than their capital by borrowing against margin: 10x leverage turns ₹10,000 into ₹1,00,000 of exposure. It multiplies gains and losses equally, and shrinks the distance to liquidation — at 10x, a move slightly under 10% against the position ends the trade.

How would a trader say it?

Borrowed size — it makes your wins bigger, your losses faster, and your liquidation closer.

Part of the Crypto Jargon glossary — every term, decoded the way a trader would say it.

Crypto Jargon

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