OceanEx offers a choice of multiple adjustable leverages, currently supporting 100x leverage in cross position and 10-100x in a fixed position.
Cross Margin, also known as “Spread Margin”, is a margin method that utilizes the full amount of funds in the Available Balance to avoid liquidations. Any Realised PnL from other positions can aid in adding a margin on a losing position. This margin method is useful for users who are hedging existing positions and also for arbitrageurs that do not wish to be exposed on one side of the trade in the event of a liquidation.
Fixed Margin is useful for speculative positions. By fixing the margin the position users, you can limit your losses to the initial margin set, and thus helps short-term speculative trade ideas that turned out incorrectly. In a volatile market, a highly leveraged position can lose equity quickly. However, note that although OceanEx aims to minimize liquidations from happening, in volatile markets, highly-leveraged positions are more likely to be liquidated.
Limit orders are used to specify a maximum or minimum price the trader is willing to buy or sell at. Traders use this order type to minimize their trading cost, however they are sacrificing guaranteed execution as there is a chance the order may not be executed if it is placed deep out of the market.
User Inputs: Quantity, Limit Price
Limit Order Example
Quantity = 10 Contracts
Limit Price = 100
Direction = Buy
A bid of 10 contracts will be placed in the market with a Limit Price of 100.
A market order is an order to be executed immediately at the current market prices. Traders use this order type when they have an urgent execution. Pay attention to the order book when selecting this order type, otherwise a large market order may “walk the book” and incur market-impact costs.
User Inputs: Quantity
Trigger orders are set with a condition. When the market fluctuates and reaches the preset condition the order will be submitted according to the preset price. Users may use this order function to stop losses, to retain profits and to cut transactions costs.
For more information, please read -> Trigger Orders
If a trader believes that the price would rise, he/she may open a long position by buying in contracts in the market.
After the price rises, the trader may choose to earn profits by closing these long positions, just like what we do in Spot trading market by buying low and selling high.
If a trader believes that the price would drop, he/she may close a short position by selling in contracts in the market.
After the price falls, the trader may choose to earn profits by buying these short positions, just like what we do in the Spot trading market by selling high and buying low.
OceanEx Perpetual Contract implements a unique design based on what is called the “Fair Price Marking System”. This system sets the Mark Price of the contract to the Fair Price instead of the last trading price. With this system implemented, it avoids situations in high leverage where it normally would unnecessarily force liquidate. Without this system, the marked price could be potentially manipulated or due to a lack of fluidity and create a fluctuation in the index price, potentially causing forced liquidations.
All auto-deleveraging contracts use the fair price marking method. This method only affects the forced liquidation price and unrealized profits. It will not affect realized profits.
Note: This means that after your order is executed, you may immediately see unrealized profits or losses. This is due to the price difference between the fair price and the executed price. This is perfectly normal and does not mean you already have a loss. But at the same time you need to be mindful of your forced liquidation price to avoid being forced liquidated ahead of time.
Forced Liquidation Price
When the fair price reaches a position’s forced liquidation price the system will close the position automatically. Please be aware of this price and, in time, add margin or close the position.
Margin & Actual Leverage
All OceanEx perpetual contracts require margin. Margin trading will also allow your contract to use higher leverage.
When trading margin please note the following:
— Initial Margin: the lowest margin required for opening the position, and will affect the leverage of this position. Initial margin = value of position/position margin.
— Maintenance Margin: the margin required for maintaining your position. It drops to lower than this ratio it will trigger a forced liquidation.
— Opening Cost: the cost of opening a position. This cost will be locked in your account and includes the initial margin and possible transaction fees.
— Actual Leverage: the leverage of unrealized profits/losses for the current position.
OceanEx Perpetual Contract uses a risk-control limitation for all trading accounts to lower the risk of large multiple forced liquidations.
If some users have large open positions, this may bring risks to other users. And if they are forced liquidated other users may experience auto deleveraging. Risk-control limitations will help to prevent this type of event from happening. It will raise the margin requirements for large positions.
Regarding OceanEx Perpetual Contract’s Margin guide please refer to -> Margin Guide
Unrealized profits and losses are calculated by the fair price by default. It is the estimated profits or losses in accordance with the fair price when closing the position. It is not the actual profits/losses when the position is closed. Actual profits and losses are calculated with reference to the closing price. Unrealized profits/losses’ calculation can be changed in your [Settings] to be calculated with the [Latest Price].
Realized profits and losses mainly include previous fees and profits/losses from closed positions. Fees will be deducted from the closed position’s margin.