About the Operation Process of Futures Trading
WEB
1 Log in to the CoinW official website and click the【Futures】button in the upper navigation bar to directly enter the contract trading interface;
2 Click the currency pair icon in the upper left corner to select the token you want to trade;
3 After selecting the currency pair you want to trade, you can open a position: select the order type, leverage multiple, price, and quantity to open an order;
Note: Before placing a futures transaction, please transfer USDT from your asset account to your futures account.
Introduction to the types of orders
Market Order: Refers to the execution at the best price in the market, and the trader enters: quantity
Limit Order: It means that the trader sets the lowest/maximum amount he wants to buy/sell, and the trader enters: price, quantity.
Conditional Order: It will only be triggered when the preset conditions are met. The trader needs to specify a trigger price as a condition for activating the order
4 After the position is successfully opened, your order and position order will be displayed in the following position list:
Here's a translation of the terms related to futures trading operations:
I. Position: Displays successfully opened positions. Allows setting and modifying stop-loss and take-profit levels, closing positions, and opening positions in the opposite direction.
II. Copy Trading: Displays positions being copied from another trader.
III. Current Orders: Displays current orders that have not yet been executed. Can be cancelled at any time.
IV. Current Plans: Displays planned orders that have not yet been triggered. Can be cancelled at any time.
V. Order History: Shows historical orders that have been executed.
VI. Position History: Shows historical positions that have been closed.
VII. Account Statement: Detailed account statement for the futures account, including transfers, fees, profit and loss, funding fees, etc.
APP
1 Log in to the CoinW APP and click the【Futures】button in the navigation bar below to enter the futures trading interface
2 Click the currency pair icon in the upper left corner to select the currency you want to trade;
3 After selecting the currency pair you want to trade, you can open a position: select the order type, leverage multiple, price, and quantity to open an order;
Note: Before engaging in contract trading, please transfer USDT from your asset account to your contract account.
Order Types Introduction:
1. Market Order: Executes at the best available market price. Traders specify: Quantity.
2. Limit Order: Traders set a specific price to buy/sell at a minimum/maximum. Traders specify: Price, Quantity.
3. Conditional Order: Triggered only when a predetermined condition is met. Traders specify a trigger price as the condition for activating the order.
4 After the position is successfully opened, your order and position order will be displayed in the position list below.
Click on the right icon to view the order history;
FAQ
1 What is Futures Trading?
CoinW USDT perpetual contract is a virtual contract product settled in USDT, each contract represents a certain amount of digital currency (for example, BTC/USDT contract, each contract represents 0.001 BTC), investors can buy long contracts to obtain the income of virtual digital currency prices, or sell short to obtain virtual digital currency income.
2 Leverage
It allows for significantly enhanced capital efficiency in futures trading. When trading futures contracts, you only need to commit a small portion of the total contract value to open a position. For instance, with 100x leverage, you can control a contract worth 1 BTC by depositing a fraction of its value as margin.
To illustrate:
- In spot trading, if the current market price of 1 BTC is $30,000 USDT, you would need to spend $30,000 USDT to acquire 1 BTC.
- In contrast, in futures trading with 100x leverage, you might only need to deposit $300 USDT as margin to control a contract worth 1 BTC.
This leverage magnifies both potential profits and losses. While it allows traders to access larger positions with less initial capital, it also increases risk due to the amplified exposure to market movements. Therefore, it's crucial for traders to manage risk effectively when utilising leverage in futures trading.
3 The choice between long and short positions
If you hold USDT in spot, all you can do is buy the currency. When the market continues to fall, you cannot make a profit by buying the currency;
However, in the contract, if you hold USDT, you can choose to go long or short according to the market conditions. When the market continues to fall, you can choose to go short to make a profit. When the market continues to rise, you can choose to go long and make a profit.
4 The differences between Cross Margin and Isolated Margin:
Cross Margin:
- In Cross Margin mode, the entire balance of the futures account is used as collateral.
- If a position in Cross Margin mode is liquidated (forcefully closed), it can affect the entire account balance because all funds are pooled together to cover margin requirements.
- Cross Margin can help mitigate the risk of individual position liquidation by using the entire account balance to support all open positions.
Isolated Margin:
- In Isolated Margin mode, specific amounts of margin are allocated to individual positions.
- Each position is isolated from others, meaning if one position is liquidated, it only affects the margin allocated to that particular position.
- The remaining balance in the account that is not allocated to any position (unused margin) is not affected by the liquidation of other positions.
Note:
- To switch between Cross Margin and Isolated Margin modes, ensure there are no open positions or pending orders. If there are any, they must be closed or canceled before switching modes.
- Choosing between Cross Margin and Isolated Margin depends on risk management preferences and trading strategies. Cross Margin provides overall account protection but can expose the entire balance to larger risks, while Isolated Margin allows for more precise risk control per position.
5. Functionalities related to combining and splitting positions (Merge and Split modes):
Merge Mode:
- After adding new orders, positions in the same trading pair and direction are combined and displayed together.
- The average opening price of all merged positions is calculated and shown.
- Corresponding margin requirements and estimated liquidation prices are adjusted based on the aggregate position.
Split Mode:
- After adding new orders, positions in the same trading pair and direction remain separate and displayed individually.
- Each position maintains its own unique opening price.
- Margin requirements and estimated liquidation prices are calculated independently for each isolated position.
Note:
- To change between aggregate and isolate modes, ensure there are no existing positions or pending orders. If there are any, they must be closed or cancelled before switching modes.
- Switching modes affects how positions are managed and displayed, influencing margin calculations and risk management strategies.
These modes provide flexibility in managing positions, allowing traders to choose how they want their positions to be aggregated or kept separate based on their trading strategies and risk preferences.
6. Take Profit and Stop Loss
Take Profit (TP) and Stop Loss (SL) are types of strategy orders. Users can pre-set prices or percentages for TP and SL. When the market reaches these prices or when the floating profit or loss reaches the set percentage, the system automatically places the order. There are two types of TP and SL settings: unidirectional and bi-directional. In bi-directional TP and SL, if one side is triggered, the other side automatically cancels.
Market Price TP/SL:
When the latest price reaches the pre-set TP or SL trigger price, a market order is placed to close the position. Due to market fluctuations, the actual execution price may deviate from the set price.
Limit Price TP/SL:
When the latest price reaches the pre-set TP or SL trigger price, a limit order is placed to close the position. Depending on market conditions, the order may not be filled or only partially filled based on the specified order price.
These mechanisms allow traders to automate the process of taking profits or cutting losses based on predetermined conditions, providing risk management and execution flexibility in futures trading.