Ara
Opening a spot position on margin
The availability of margin trading services is subject to certain limitations and eligibility criteria. Opening a spot position on margin occurs when you use an extension of margin from Kraken to make a spot purchase or sale of cryptocurrency on the Kraken exchange. 
There are two types of spot positions on margin that can be opened: long and short

Example

"Long ETH"

  • If you take on an extension of margin from Kraken denominated in USD, and buy ETH for USD on the ETH/USD order book, you would be opening a “long ETH” spot position on margin. 

"Short ETH"

  • If you take on an extension of margin from Kraken denominated in ETH, and sell ETH for USD on the ETH/USD order book, you would be opening a “short ETH” spot position on margin. 
By opening a spot position on margin, you incur corresponding obligations, including the obligation to return the amount of the margin extension to Kraken through position settlement or one or more closing transactions. Your spot position on margin remains open until these obligations are satisfied. 
How to open a spot position on margin on Kraken Pro
To create an order to spot trade using margin first select the Margin tab - then enter everything in the order form just as you would for a regular spot trade (the "Amount" field still determines the size of the order, the price parameters for the various order types work the same, etc.)
Screen_Shot_2022-09-19_at_11.38.07_AM.png
Using leverage means that the order, if executed, will execute through a “two-step” process, involving: first, an extension of margin from Kraken to you; then second, an immediate spot trade between you and one or more counterparties on the Kraken exchange (where you use the margin extension received from Kraken to settle your side of the trade with the counterparty).
Note: In order to open a spot position on margin, you will need to hold a sufficient balance of at least one Collateral Currency.
If you only hold funds in non-collateral currencies, you will not be able to spot trade on margin until sufficient collateral currency is deposited in your account or acquired from the market.
How to open a spot position on margin on Kraken Classic
To create an order to spot trade using margin, you enter everything in the order form just as you would for a regular spot trade (the "Amount" field still determines the size of the order, the price parameters for the various order types work the same, etc.) — EXCEPT you must select a level of leverage for the order:
Trading_LeverageRatioETH_USD_09082021.png
You can only select leverage in the Advanced order form.
Selecting a level of leverage means that the order, if executed, will execute through a “two-step” process, involving: first, an extension of margin from Kraken to you; then second, an immediate spot trade between you and one or more counterparties on the Kraken exchange (where you use the margin extension received from Kraken to settle your side of the trade with the counterparty).
Note: In order to open a spot position on margin, you will need to hold a sufficient balance of at least one Collateral Currency.
If you only hold funds in non-collateral currencies, you will not be able to spot trade on margin until sufficient collateral currency is deposited in your account or acquired from the market.

What about the different levels of leverage?

For information on how leverage works for margin transactions, click here