Derivatives Trading
Derivatives trading is open to verified users in eligible jurisdictions.
In order to trade derivatives, you should hold USDt0 in your derivatives wallet.
In order to hold USDt0, you will need to convert USDt to USDt0. Please see our article on how to convert here: “How to convert USDt to USDt0”
To open a short position:
Go to the Derivatives page > Select the desired pair > e.g. BTCf0/USDt0
Set up a Derivative Sell order in the Order Form: (specify the amount, order type & price).
Select your order type, and choose the leverage you would like to trade with by moving the slider or by typing a number in the leverage box. The maximum leverage for derivatives trading is 100x. The leverage will determine the amount of allocated collateral.
To place your order click "Derivative Sell".
When you want to close the position, either use the close button (a Market Derivative Buy order will close the short) or place a Derivative Buy order of the same amount of BTCf0 as your short.
To open a leveraged long position, take the same preparatory steps for your order as above and click “Derivative Buy”. To close your position you may also use the close button (a market derivative sell order will close your long) or place a derivative sell order of the same amount of BTCf0 as your long.
Collateral
*Minimum Initial Margin is 1%. This means the USDt0 collateral allocated to that position needs to be at least 1% of the USDt0 value of the position you wish to open.
If you have 100 USDt0 in your derivative wallet, those 100 USDt0 can serve as collateral for opening positions up to 100:1. i.e. Margin positions with a USDt0 value up to 10,000 USDt0.
Unlike our asset margin trading platform, our derivatives platform uses isolated margining, which means that you can allocate a specific amount of collateral to a position, instead of all of the funds in the wallet being used to cover all active positions in the account.
Losses resulting from manually executed orders can still be greater than the allocated collateral as a result of slippage.
Example:
Say you have 1000 USDt0 and you want to open two positions. The price of BTCf0 is $8000.
You can open positions with a total value up to 100,000 USDt0 (1000 x100).
The first position you open is a long 1.25 BTCf0/USDt0 worth 10,000 USDt0, and you choose 20x leverage for that position. This allocates 500 USDt0 as collateral
You now have 500 USDt0 available in your derivatives wallet.
The price of ETHf0 is $400. You decide to open another long for 40 ETHf0/USDt0 worth 16,000 USDt0, using 80x leverage. This allocates 200 USDt0 as collateral, leaving 300 USDt0 available in your derivatives wallet.
*Please refer to our article on the Liquidation Policy as our Initial Equity and Maintenance Margin requirements change according to the size of the position. https://www.bitfinex.com/legal/derivative_fee