Difference Between ETF and Margin

Let’s explore what is ETF Product and how to use it in crypto trading. It’s time to find difference between ETF and Margin.

ETF Products

Similarity between ETFs and Margin

ETFs and Margin Trading can amplify the price changes of Spots according to a certain multiple.

The differences between ETFs and Margin are:

  • Compared to Margin trading, ETF trading is more convenient, the cost is lower, there is no need to pay for margin, there is no liquidation risk, and the capital utilization rate is higher. It can generate compound interest under a unilateral market, and the profitability is better than Spots and Margin Trading.
   ETF  Margin Trading
PriceOpens at 1U and tracks the price changes of the underlying assetConsistent with spot price
Compound InterestCompound interest generated by unilateral marketFixed leverage multiple, no compound interest
Liquidation RisksNo liquidation risksLiquidation is triggered when the account risk rate is ≤ 105%
MarginNo margin requiredRequires margin
Trading MethodFor spot trading, buy “L” to go long, buy “S” to go short, and sell to close the positionIf you need to borrow or return USDT or the corresponding currency, “Buy” refers to going long and “Sell” refers to going short
FeesTrading fee 0.2% + 0.001% management fee per multipleTrading fee 0.2% + cryptocurrency borrowing interest
ETF & Margin Comparison

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