U-based Contract Trading Guide

Contract trading allows you to participate in market price fluctuations and profit from them by going long or short on a certain contract. If you choose to go long, it means you expect the price of the contract you purchase to rise in the future.

On the CoinUp io trading platform, you can also use leverage when going long or short to hedge risks or profit in unstable market conditions. If you choose to go short, it means you sell the contract and predict its value will fall in the future.

1. Transfer USDT to the U-based contract account as margin;
2. Select your leverage ratio; 
3. Choose the appropriate order direction (buy or sell);
4. Enter the number of contracts you choose to trade. 

In the spot market, traders can only profit from the rise in asset prices. Through contracts, whether the asset price rises or falls, you have the opportunity to make profits.

How to calculate the profit & yield rate of U-based contracts

● Users choose to use the mark price as the price benchmark:

Profit = Position quantity * Opening direction * (Mark price - Opening price)

Yield rate% = Profit / Initial margin = ((Mark price - Opening price) * Opening direction * Position quantity) / (Position quantity * Contract multiplier * Mark price * Initial margin rate) * Initial margin rate = 1 / Leverage multiple 

● Users choose to use the latest price as the price benchmark:

lProfit = Position quantity * Opening direction * (Latest price - Opening price)

Yield rate% = Profit / Initial margin = ((Latest price - Opening price) * Opening direction * Position quantity) / (Position quantity * Contract multiplier * Mark price * Initial margin rate) 

 U-based contract leverage and margin

Contract leverage

CoinUp io supports different maximum leverage multiples (up to 125 times) for different contract currency pairs.Details can be viewed on the illustrated page.

Before opening a position, users need to adjust the leverage multiple by themselves. If the user does not adjust the leverage multiple, the default leverage multiple of the contract platform is 1 time, and the user can adjust the leverage by themselves. The higher the leverage multiple, the smaller the maximum position that the user can establish.

● Margin

The leverage principle of contract trading is concentrated in the margin system of contract trading. That is, when conducting contract trading, you do not need to pay 100% of the funds. Only a small amount of funds needs to be invested as collateral for fulfilling the contract according to the contract value at a certain ratio to participate in the buying and selling of the contract. This fund is called margin.

 1) Leverage greatly improves the utilization rate of funds, and high returns are accompanied by high risks.

2) The higher the leverage used by traders, the lower the required margin.

Opening margin = (Opening quantity × Opening price) / Reasonable mark price of margin currency

● Position margin

After the position is established, you can view the current position margin in the "Position" on the contract trading page.

The margin allocated to the position can be manually adjusted by [Adding margin], and automatic addition is not supported.

How to calculate the liquidation price of U-based contracts?

Contract liquidation price = Opening price - Opening direction × (Margin × (1 - Liquidation risk rate) - Close position fee - Open position fee) / Position quantity

Opening direction: 1 for buy order; -1 for sell order