Binance Exchange Margin Quiz Answers 2022

Binance Margin Quiz Answers (August 2022)

Looking to start crypto trading with leverage on the Binance exchange? Before starting margin trading on Binance, you must answer all the questions on the Binance Margin quiz. This is an assessment that tests your knowledge on trading with margin, its associated risks, and the relevant measures you should take for your own financial security.

Until you pass the Binance Margin Trading Quiz, you will not be able to trade any funds using this functionality. Whilst the test is quite straightforward, this requirement can create problems for many crypto investors who want to start Margin Trading.

So, let’s dive into this Binance guide, where we provide you with everything you need to answer the Binance Margin Quiz questions for 2022.

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Binance Margin Quiz Answers for August 2022

Below we have put together the latest answers to the 12 questions for the Binance margin quiz. Once the quiz has been completed, you can start trading with leverage.

Binance Margin Quiz Answer

Please beware; trading cryptocurrency, especially with a margin is extremely risky.

Binance Margin Quiz Question 1: Margin & Isolated Margin

Question 1: Binance Margin includes cross margin and isolated margin. Which one of the following sentences does not describe their difference?

Answer Options:

  • In isolated margin, borrowing, trading, and risk management functions are included in an independent isolated margin account, while in cross margin, each user can only open one cross margin account where borrowing, trading, and risk management functions are available.
  • They have different interest rates
  • They have different maximum leverage ratio
  • They support different borrowables

Binance Margin Quiz Answer 1: They have different interest rates

Binance Margin Quiz Answer 1

Binance Margin Quiz Question 2: How is Margin Level Calculated?

Question 2: Margin level is used to evaluate the risk level of your margin account. How is the margin level calculated?

Answer Options:

  • In isolated margin, borrowing, trading, and risk management functions are included in an independent isolated margin account, while in cross margin, each user can only open one cross margin account where borrowing, trading, and risk management functions are available.
  • They have different interest rates
  • They have a different maximum leverage ratio
  • They support different borrowables

Binance Margin Quiz Answer 2: They have different interest rates

Binance Margin Quiz Answer 2

Binance Margin Quiz Question 3: Events that Will Force Liquidation

Question 3: Which one of the following events will force you to liquidate?

Answer Options:

  • The margin level has reached the liquidation level
  • The current margin level has reached the initial margin level
  • The total debt is lower than the total interest

Binance Margin Quiz Answer 3: The margin level has reached the liquidation level

Binance Margin Quiz Answer 3

Binance Margin Quiz Question 4: Margin Interest Calculations

Question 4: How often is margin interest calculated?

Answer Options:

  • Hourly, at the time of borrowing
  • Daily
  • Monthly

Binance Margin Quiz Answer 4: Hourly, at the time of borrowing

Binance Margin Quiz Answer 4

Binance Margin Quiz Question 5: Manual Borrowing

Question 5: Do you need to borrow manually before trading?

Answer Options:

  • Yes
  • No, you can use the “Auto Borrow” function on the trading page

Binance Margin Quiz Answer 5: No, you can use the “Auto Borrow” function on the trading page

Binance Margin Quiz Answer 5

Binance Margin Quiz Question 6: Maximum Borrowing

Question 6: Which one of the following factors does not affect your maximum borrowing limit?

Answer Options:

  • The borrowing period
  • The amount of funds in your margin account
  • Your VIP level
  • The system borrowing limit
  • Your individual borrowing limit

Binance Margin Quiz Answer 6: The borrowing period

Binance Margin Quiz Answer 6

Binance Margin Quiz Question 7: Borrowing Interest Rate

Question 7: Which one of the following sentences is correct regarding your borrowing interest rate?

Answer Options:

  • The borrowing interest rate will change with the market, and the system will notify you when it changes
  • The borrowing interest rate will be determined at the time of borrowing, no changes afterwards

Binance Margin Quiz Answer 7: The borrowing interest rate will change with the market, and the system will notify you when it changes

Binance Margin Quiz Answer 7

Binance Margin Quiz Question 8: Repaying Debts

Question 8: In the event of liquidation, how to repay your debts?

Answer Options:

  • Binance insurance funds will write off your debts
  • You are required to repay the debts yourself

Binance Margin Quiz Answer 8: Binance insurance funds will write off your debts

Binance Margin Quiz Answer 8

Binance Margin Quiz Question 9: Pay Interest Fees

Question 9: How to pay the interest fee with BNB in cross margin?

Answer Options:

  • Transfer BNB to cross margin account and repay manually
  • Repay with the loan

Binance Margin Quiz Answer 9: Transfer BNB to cross margin account and repay manually

Binance Margin Quiz Answer 9

Binance Margin Quiz Question 10: Margin Call Notifications

Question 10: When you receive a margin call notification, what should you do?

Answer Options:

  • Borrow more funds to hedge the risk
  • Reduce your position to repay the debt or add more collateral into the margin account
  • Do nothing

Binance Margin Quiz Answer 10: Reduce your position to repay the debt or add more collateral into the margin account

Binance Margin Quiz Answer 10

Binance Margin Quiz Question 11: Forced Liquidation

Question 11: When trading on Margin, a forced liquidation occurs when the margin risk ratio (total assets/total debts) reaches the liquidation risk ratio. Users are charged a “Liquidation Clearance Fee” in the event of forced liquidation. Which of the following contains the correct description for Liquidation Clearance Fees?

Answer Options:

  • The Liquidation Clearance Fee is a fixed value for each liquidation.
  • When the position is forcedly liquidated, the user will only be charged with commission fees of liquidation orders and does not need to pay additional “Liquidation Clearance Fees”.
  • When the position is forcedly liquidated, a Liquidation Clearance Fee will be charged according to the amount of the assets being liquidated. The system may use all the remaining assets in the margin wallet to complete the liquidation.

Binance Margin Quiz Answer 11: When the position is forcedly liquidated, a Liquidation Clearance Fee will be charged according to the amount of the assets being liquidated. The system may use all the remaining assets in the margin wallet to complete the liquidation.

Binance Margin Quiz Answer 11

Binance Margin Quiz Question 12: Margin Risk Ratio

When the margin risk ratio (total assets/total debts) of your margin wallet reaches liquidation risk ratio, which one of the following best describes what will happen?

Answer Options:

  • When your margin wallet is under liquidation, you will not be able to trade with this wallet
  • The system will automatically sell your assets to repay your debts
  • You will be charged a liquidation clearance fee according to the amount of assets being liquidated
  • All of the above

Binance Margin Quiz Answer 12: All of the above

Binance Margin Quiz Answer 12

What is Binance Margin Trading?

Binance Margin trading is a method of trading using funds provided by a third party. When compared to regular trading accounts, margin accounts allow traders to access greater sums of capital. Allowing traders to leverage their positions and amplify their trading results.

In traditional markets, the borrowed funds are provided by a broker. In cryptocurrency trading, funds are often provided by other traders, who earn interest based on market demand for margin funds.

Binance Margin Trading

Conclusion

Hopefully, you have now completed the margin quiz using the above Binance Margin Quiz answers and will be able to start trading with margin on the Binance exchange.

Margin trading cryptocurrency isn’t for beginners and is very risky and should be used with caution.

Other Crypto Quizzes

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