Plain English
Isolated margin assigns collateral to a single position — losses are capped at that allocation. Cross margin uses your entire account as collateral for all positions — bigger buying power, but one bad position can liquidate your whole account.
How it actually works
Isolated: post $1K to a BTC perp; that $1K is the only thing at risk. The position liquidates at zero with no impact on other positions. Cross: post $10K to the account; trade BTC perp, ETH perp, SOL perp all from the same pool. Each position’s liquidation price depends on the total account equity.
What it means for you
For directional bets you want firewalled, isolated margin is the safer choice. For market-neutral or correlated strategies (basis trades, paired longs/shorts) cross margin is far more capital-efficient because gains in one position offset losses in another. The HNW rule of thumb: isolated for high-conviction directional, cross for multi-leg structured trades.
Will this information be valuable to you?
Already a member? Send this term to your coach inside the community and tell them exactly what you need help with — we will build a plan around it.
New here? Join the membership, become a student, or sit in on the community. Your starting point is one short call.
Educational content only. Not investment, tax, or legal advice.