Term | Definition |
The average price of an underlying asset | |
The digital asset that a Futures/Perpetual Contract price is based on | |
The latest price at which the asset was traded | |
Mark Price / Mark-to-Market / MTM | Mark Price is a relatively fair price weighted by multiple prices; its main purposes are:
For Mark Price calculation, please visit: This FAQ |
The current price of a specific asset that can be traded immediately | |
The reference value of the underlying assets corresponds to the position you currently hold * Notional Value = current Mark Price x Position Size x Contract Size E.g. If you buy 100 BTC contracts at $4000 (but the current mark price is $4020), then the current notional value is 4020 x 100 x 0.001 = $402 | |
The amount of underlying assets that each contract contains. Each contract contains 1/1000 underlying asset, so the contract size is 0.001 | |
The amount of contracts that you trade when a position is taken. | |
A position is the amount of contracts owned by you. There are two types of positions:
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Long Position / Buy Position | Purchased first and sold later For example: If you have purchased 100 contracts of BTC, then you are holding a long position; you must sell these contracts to close this position. |
Short Position / Sell Position | Borrowed to sell first, then bought back. For example: If you borrowed 100 contracts of BTC to sell, then you are holding a short position; you must buy back the same amount of contracts to close this position. |
The initial buy/sell price of the position. | |
The ratio of the initial margin to the order value. The greater the leverage, the less initial margin you need to pay, which means you can obtain a larger position with the same amount of initial margin.
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The minimum initial margin percentage and minimum maintenance margin percentage for different position sizes.
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You must provide a certain amount of capital in order to open/hold a contract. The percentage you must pay depends on what leverage you have chosen. E.g. With 100x leverage, you have to put in 1% of the order value as your margin. | |
The minimum available margin balance required when you open a position. | |
A margin balance that required to maintain the position (your margin balance must be greater than this amount). Once the balance is equal to or less than the maintenance margin, your position will be liquidated or partially liquidated depending on the circumstances. | |
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Liquidation / Forced Liquidation / On-Market | When the Mark Price reaches the liquidation price, it signifies that your margin wallet's available balance has been exhausted, and you no longer have sufficient funds to maintain the position. In response, the system will: 1. Assume control of both your position and the remaining margin associated with it. 2. Attempt to initiate a forced market buy/sell or close the position (or part of it) at a price level between the liquidation price and the bankruptcy price. 4. Should the position remain unclosed after further adjustments, auto-deleveraging will be initiated to close the position (or the remaining portion of it). |
The price where the mark price level will trigger liquidation, partial liquidation, or a forced market buy/sell. | |
Liquidation Notification (Margin Call) | When liquidation, partial liquidation, or a forced market buy/sell occurs, the system would automatically send an email to notify you. |
The price where the margin balance is zero. | |
Auto-Deleveraging / ADL / Off-Market | When a trader’s position is liquidated or partially liquidated, the position will be taken over by the liquidation engine. If the position cannot be closed at the bankruptcy price, the engine will try to draw extra margin from the BTSE insurance fund to further adjust the price of the liquidation order. If the position still can't be closed after further adjustment, Auto Deleveraging (ADL) will occur to close the position. When an ADL occurs, the system will reduce or close the opposing trader's position until the liquidation order is filled. The deleveraging sequence is determined by the ADL ranking. More profitable and higher leveraged traders will be auto deleveraged first. You can check the ADL indicator to find out your ADL ranking level. The higher bars you see means the higher chances of being auto deleveraged. To avoid this, you can add more margin to reduce the leverage ratio and lower your ADL ranking. |
Profit and Loss | |
Unsettled profit and loss from the open position. Displayed unrealized PnL: Longs = (Current Mark Price - Position Entry Price) x Contract Size (0.001) x Position Size Shorts = (Position Entry Price - Current Mark Price) x Contract Size (0.001) x Position Size | |
Settled profit and loss from the open position. Realized PnL: Longs = (Market Price - Position Entry Price) x Contract Size (0.001) x Position Size - Transaction Fee Shorts = (Position Entry Price - Market Price) x Contract Size (0.001) x Position Size - Transaction Fee | |
A market maker is a brokerage house that provides purchase and sale solutions for investors in order to provide liquidity to the markets. | |
Click Here to see the example. | |
Basis / Basis Differential | When a futures contract reaches the expiry date, the contract price should be quite close to the spot price, if not, the difference between the spot price and the futures price called Basis or Basis Differential. |
Bid / Bid Price | An offer made by a buyer to buy a contract. |
Ask / Ask Price | An offer made by a seller to sell a contract. |