(a) By warehouse and full warehouse have different meanings.
1. Man Cang mode means that all available balances in the account can be used as collateral assets to avoid forced liquidation. The advantage of this model is that as long as the leverage is moderate, the possibility of short positions is very low, so it is often used for hedging.
2. Warehouse-by-warehouse mode means that the secured assets allocated to a position are limited to a certain amount. If the secured assets of the position are insufficient to support the floating loss, the position will be forced to close. Therefore, in the case of large fluctuations and large leverage, the warehouse-by-warehouse model is easy to be forced to close the position, but the final loss is only the guaranteed assets, which does not affect the account balance.
Differences between warehouse-by-warehouse and warehouse-by-warehouse secured assets.
1. Man Cang's secured assets (cross-secured assets) refer to the secured assets enjoyed by all positions and are supported by the balance in the entire secured assets account.
2. Warehouse-by-warehouse secured assets (independent secured assets) are secured assets with a single position, which are independent of other positions and supported by the balance of the independent secured assets account.
To sum up, Man Cang lever is more suitable for institutions or experienced users as hedging tools, and warehouse-by-warehouse lever is more suitable for novice users to limit losses to a range.
Advantages and disadvantages of Man Cang and warehouse by warehouse
(1) Man Cang model
1. The advantage of this model is that it is simple to operate, and one account can be opened without running back and forth. The unrealized gains and losses of any other position can be directly used as the margin of another contract.
2. For example, my btc position made money and my ETH position lost money. Although BTC has not closed its position, unrealized gains and losses can be directly used as the margin for additional ETH, which can achieve the purpose of hedging between contracts, reduce the overall margin requirements and improve the utilization rate of funds. Finally, because all available balances in the account are used as margin, as long as the leverage is moderate, the possibility of short positions is relatively low.
Of course, this shortcoming is also obvious. If the position is short, all the funds in the account will be lost. Therefore, the whole warehouse model is more suitable for institutions or experienced users as hedging and quantitative trading.
(2) warehouse by warehouse mode
1. Position margin is very useful for speculative positions. The assets in this account are your biggest possible loss, so as to help you when your short-term speculative trading strategy fails and limit the loss to a range.
2. For example, in the case of large fluctuations and leverage, although it is easy to be leveled, the ultimate loss is only the assets under this account, and it does not affect the balance of other accounts. Therefore, in the turbulent market, everyone wants to have a high leverage, although the wrong judgment may soon lose the margin.
3. However, if you want to effectively control the loss of each opening, you can adopt the warehouse-by-warehouse mode. Therefore, it can be briefly summarized: in the use of account funds, the full warehouse model is that all account funds are used as security deposits and enjoyed by multiple contract positions. The warehouse-by-warehouse mode is to calculate the margin separately for each account, and the profit and loss do not affect each other. It can be understood that the whole warehouse is to put all the eggs in one basket, and the warehouse-by-warehouse is to spread the eggs into multiple baskets.
(3) On the whole,
On the risk of leveling, it can be understood that Quancang is an "online grasshopper". When the deposit is not enough, the basket falls down, the eggs are all broken, and the account amount is all gone. Warehouse by warehouse means that multiple baskets are independent. If one basket falls down, it will not affect the eggs in other baskets. The above is the introduction of relevant content. Generally speaking, the Man Cang model is suitable for hedging investors, and it is also more suitable for institutions or experienced users as hedging tools, while the warehouse-by-warehouse model is suitable for short-term trading investors, and it is also more suitable for novice users to limit their losses within a range and better implement risk control strategies.