Derivatives
Leverage
Controlling a position larger than your capital by borrowing from the exchange, which multiplies both gains and losses.
At 5x leverage a 2 percent move in the asset is a 10 percent move in your equity. Isolated margin confines the risk to one position; cross margin lets the whole account back every position, which delays liquidation but risks everything at once.
Leverage pays funding and is subject to liquidation, so a correct directional call can still lose if the path is too volatile. Whale wallets BetG8 tracks commonly run 3x to 20x on majors.
Prediction markets involve no leverage: the most a Yes share can lose is its price.
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Frequently asked questions
- What does "Leverage" mean?
- Controlling a position larger than your capital by borrowing from the exchange, which multiplies both gains and losses.
- Why does leverage matter for prediction markets?
- Prediction markets involve no leverage: the most a Yes share can lose is its price.