In Margin Trading, a position is your net balance of an asset in your Margin Wallet: what you hold minus what you owe.

Long position and short position

If you hold more than you owe, you have a long position. If you owe more than you hold, you have a short position. You have one net position per asset: you can't be long and short the same asset at the same time.

Example: you hold 0.05 BTC and owe 0.02 BTC. Your net position is 0.03 BTC long. If instead you held 0.01 BTC and owed 0.03 BTC, your net position would be 0.02 BTC short.

How a long position works

You open a long position when you borrow funds to buy more of an asset than your own balance allows. You profit if the asset's price goes up.

Example: you have 1,000 USDT and buy 3,000 USDT worth of BTC. Bitso automatically lends you the missing 2,000 USDT. You now hold BTC and owe 2,000 USDT plus interest. If BTC rises, you can sell it, repay the loan, and keep the difference.

How a short position works

You open a short position when you sell an asset you don't hold. Bitso automatically lends you the asset so you can sell it. You profit if the asset's price goes down.

Example: you have 1,000 USDT and no BTC. You sell 0.01 BTC and Bitso lends you the BTC. You now hold extra USDT and owe 0.01 BTC plus interest. If BTC drops, you can buy it back cheaper, repay the loan, and keep the difference.

What else affects your position

Assets you transfer into your Margin Wallet also appear as long positions, even without any borrowing involved, and they don't accrue interest.