Contract Trading
Contract trading is a type of financial derivative. Compared to spot trading, contract trading allows investors to earn (more) profits by going long or short and using leverage.
Long/Short
In spot trading, investors can only earn profits by waiting for the asset value to increase. Unlike spot trading, in contract trading, investors can earn profits in two ways by going long or short.
About Long: This refers to when investors are optimistic about the market when purchasing contracts, expecting the price to rise. They buy a certain amount of assets at the current price, then sell at a higher price after the price increases, thereby earning the price difference profit. This is a buy first, then sell trading behavior.
About Short: This refers to when investors believe the current price is relatively high but are pessimistic about the market outlook when purchasing contracts. They sell the assets they hold at the current price, then buy back after the price drops, earning the price difference profit. This is a sell first, then buy trading behavior.
Nodexx Contract Trading Steps
After logging into your Nodexx account, transfer funds to the contract account as margin.
Step 1: Select the contract trading pair, such as BTCUSDT, ETHUSDT, etc.
Step 2: Confirm the margin mode (Cross Margin/Isolated Margin) and set the leverage.
Step 3: Choose the order type and customize the order details.
Step 4: Choose to go long or short and place the order.
Calculating Return on Investment (ROI)
USDT-Margined Contracts
Use the latest price as the price basis:
Unrealized P&L = Contract Face Value * Position Size * Order Direction * (Latest Price - Opening Price)
Return on Investment (ROI) = Unrealized P&L priced in USDT or USDC / Opening Margin = ((Latest Price - Opening Price) * Order Direction * Position Size) / (Position Value * Contract Multiplier * Mark Price * IMR)
Where
1. Trade Direction: 1 for buy (long), -1 for sell (short).
2. Trading fees are affected by the user’s taker, maker trades, and the corresponding fee rates.
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