When diving into futures trading on OKX, one of the most critical yet often overlooked settings is the choice between cross margin and isolated margin (also known as full-position and per-position modes). You may have noticed that before placing any trade, the platform prompts you to select either “Cross” or “Isolated” — but what do these actually mean? Which one should you choose? What happens if you pick the wrong one? Can you switch later?
In this comprehensive guide, we’ll break down the differences between cross margin and isolated margin, explain how to set them up on OKX, and help you make smarter decisions to manage risk effectively — especially if you're just starting out.
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Understanding Cross Margin vs. Isolated Margin: What’s the Real Difference?
At their core, both modes determine how your collateral (margin) is allocated and how your positions are protected against liquidation.
What Is Cross Margin Mode?
In cross margin mode, your entire account balance acts as shared collateral for all open positions. This means:
- All available funds in your account support every active trade.
- If one position starts losing money, the system automatically uses surplus funds from your overall balance to avoid liquidation.
- This extends the liquidation threshold, making it harder for a single position to get wiped out during short-term volatility.
Think of cross margin like a shared risk pool — gains and losses across all trades affect the same pool of capital.
"Cross margin increases capital efficiency but exposes your entire account to interconnected risk."
What Is Isolated Margin Mode?
With isolated margin, each position has its own dedicated margin allocation. Key characteristics include:
- The margin assigned to a trade is fixed and isolated from the rest of your account.
- Only the funds allocated to that specific position are at risk.
- If the price moves against you and hits the liquidation level, only that trade is closed — your other positions and balances remain untouched.
This setup is ideal for traders who want strict risk boundaries.
"Isolated margin limits exposure — a failed trade won’t take down your whole portfolio."
To simplify:
- Cross margin: One basket holds all eggs; if it drops, everything breaks.
- Isolated margin: Each egg is in its own container; damage is contained.
How to Set Up Margin Mode on OKX
Setting your preferred margin mode is simple, whether you're using the OKX mobile app or web platform.
On the OKX Mobile App:
- Open the Futures or Perpetual Trading section.
- Select your desired trading pair (e.g., BTC-USDT).
- Tap the "Cross/Isolated" toggle located above the order entry panel.
- Choose your preferred mode and confirm.
On the Web Platform:
- Navigate to the Trading Interface.
- Find the order panel on the right side.
- Click the Cross/Isolated switch.
- Select your mode — changes apply instantly.
📌 Important: Each trading pair maintains an independent margin mode setting. For example, you can use isolated margin for BTC-USD while running cross margin for ETH-USD.
Can You Switch Between Modes After Opening a Position?
No — not while you have open positions or pending orders.
You can freely switch between cross and isolated margin only when your account has no active trades or unfilled orders. Once a position is open, the system locks the margin mode to prevent sudden shifts in risk exposure.
💡 Pro Tip: Always decide on your preferred mode before entering any trade, especially during volatile market conditions. Changing modes mid-trade isn’t allowed — so plan ahead.
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Which Mode Should Beginners Choose?
For new traders, isolated margin is strongly recommended.
Here’s why:
- Controlled risk: You define exactly how much capital each trade can lose.
- Prevents total account wipeouts: A single bad trade won’t drain your entire balance.
- Easier learning curve: Clear cause-and-effect feedback helps improve decision-making.
As you gain experience and develop better risk management habits, you might consider using cross margin strategically — for instance, when you want to maximize capital efficiency across correlated positions or hedge trades.
Use this quick decision guide:
| Scenario | Recommended Mode |
|---|---|
| Learning the basics | Isolated |
| Testing a new strategy | Isolated |
| High-confidence hedging | Cross |
| Maximizing leverage across stable pairs | Cross |
But remember: higher efficiency comes with higher systemic risk.
Key Tips When Using Margin Modes
Even experienced traders can fall into traps. Here are essential best practices:
1. Isolated ≠ Risk-Free
Using isolated margin doesn’t make you immune to losses. If you apply excessive leverage without stop-loss orders, even a small price swing can trigger liquidation — fast.
2. Cross Margin Can Amplify Losses
While it delays liquidation, a large adverse move in one position can consume significant portions of your overall equity, potentially affecting other profitable trades.
3. Check Your Default Settings Regularly
Many users assume they’re in isolated mode, only to discover they’ve been trading in cross — increasing unintended exposure. Always verify the mode displayed in the top-right corner of the trading interface before confirming any order.
4. Combine With Stop-Loss and Take-Profit
Regardless of mode, always use stop-loss orders to cap downside risk. On OKX, you can set these directly in the order form for both spot and futures trades.
Frequently Asked Questions (FAQ)
Q: Can I lose more than my initial investment in isolated margin?
A: No. In isolated margin mode, your maximum loss is limited to the amount of collateral assigned to that specific position.
Q: Does cross margin improve my profit potential?
A: Not directly. It improves capital utilization by reducing unused idle margin, which may allow you to open larger positions — but profits still depend on market movement and timing.
Q: Is one mode better for day trading?
A: Yes — isolated margin is generally preferred for day trading because it allows precise control over per-trade risk and simplifies performance tracking.
Q: What happens if my cross margin position gets liquidated?
A: Only that particular position is closed. However, since it used shared equity, your total account balance will be reduced by the loss amount.
Q: Can I automate mode selection on OKX?
A: Not currently. You must manually select the margin mode for each trading pair before placing an order.
Q: Are funding rates affected by margin mode?
A: No. Funding rates are determined by market supply and demand, not by whether you’re using cross or isolated margin.
Final Thoughts: Match Your Mode to Your Mindset
Choosing between cross and isolated margin isn’t just about technical settings — it reflects your overall approach to risk.
- Use isolated margin if you value safety, clarity, and controlled experimentation.
- Use cross margin if you're experienced, actively managing multiple positions, and aiming for optimal capital use.
OKX provides a flexible, user-friendly interface that supports both strategies with clear visual indicators. By understanding these modes deeply and setting them intentionally, you significantly boost your chances of long-term trading success.
👉 Start practicing with low-risk isolated positions and build confidence today
Remember: The best traders aren’t those who take the biggest risks — they’re the ones who manage them best.