◇ GLOSSARY
Isolated / cross margin
Isolated margin caps risk to that position's collateral: you lose at most what you posted for that trade. Cross margin lets the whole account back the position, giving more room before liquidation but putting your entire balance at risk. Most venues default to cross unless you choose isolated.
Isolated puts a fence around one position. Post $500 for a BTC perp and the worst case is losing that $500 plus fees, not your whole USDC balance. Cross removes the fence: unrealized profit on an ETH perp can backstop a underwater BTC leg, but one bad cascade can drain the entire wallet.
Most apps default to cross because it reduces nuisance liquidations on small accounts. That default is dangerous if you treat each trade as independent risk. Switch to isolated when you are learning size or running multiple uncorrelated bets.
Portfolio margin is cross taken seriously: offsets across correlated legs, lower IM, same single point of failure if you mis-model correlation.