An Introduction to Inverse Futures Contracts
The Inverse Futures Contract also called Coin-M Future Contract, that allows you to long buy or short sell crypto and earn profits based on the price prediction. It is similar to a traditional Futures Contract, but it does not have an expiry or settlement date, and you can choose to close or keep the position according to the market conditions.
The Comparison of Linear Futures Contracts and Inverse Futures Contracts
| Type | Linear Futures Contracts | Inverse Futures Contracts |
| Margin | Pricing Coin（USDT） | Trading Coin（BTC, etc.） |
| Settlement Date | - | - |
| Contract Loss Mechanism | Auto-Deleveraging(ADL), Insurance Fund | Auto-Deleveraging(ADL), Insurance Fund |
| Liquidation Price | Reasonable Price Index | Reasonable Price Index |
| Price Balance Mechanism | Funding Rate | Funding Rate |
Contract Mechanisms
|
Type |
Definition |
|
Fair Price |
Inverse Contract adopts Fair Price Marking that determines the unrealized profit or loss and liquidation of the position. |
|
Initial Margin |
The minimum amount of margin for position open. |
|
Maintenance Margin |
The minimum amount of margin is required to keep your position open. The requirements of maintenance margin are tied to the Risk Limits. |
| Funding Rate |
A mechanism to ensure that the Futures market price is close to the Spot market price. Periodic payments are exchanged between the buyer and seller every 8 hours, that is, when the rate is positive, then longs will pay and the shorts will receive the rate, and vice versa when the rate is negative. Meanwhile, this rule only applies to positions open at the funding timestamps 24:00, 08:00, and 16:00 (UTC). |
|
Contract Leverage |
CoinEx futures contract employs several adjustable leverages ranging from 3X to 100X. |
|
Cross Margin |
The full amount of funds in the available balance will be utilized as margin on your position. When the initial margin is less than the maintenance margin, any available balance will be used to add margin to your position. |
|
Isolated Margin |
Any of your available balance will not be used to increase the margin when a position is liquidated. By isolating and using different margin for each position, you can limit losses on that position to the initial margin amount when your short-term speculative trading strategy fails. |
| Liquidation Mechanism |
Partial liquidation, insurance funding, and auto-deleveraging are adopted in the case of forced liquidation. |
Trading Rules
|
Type |
Definition |
| Trading Hours | 24/7 Round the clock, no limitation on the settlement date. |
| Order Type | Short Sell, Long Buy, Long Sell Close, and Short Close. |
| Position | Only one position is available for one contract market at the same time: Assuming you have successfully opened a short position, you cannot open a long position simultaneously. Any long position will reduce your current short position. On one hand, your current short positions will become long position when the number of long contracts exceed the short position. On the other hand, your current short positions will increase when you sell short. In this case, you can’t long and short the same contract. |
Position/Order Limit
BTCUSD
| Contract | BTCUSD |
| Trading Unit | * Cont |
| Contract Value | 1 USD |
| Quote Currency | USD |
| Settlement Coin | BTC |
| Minimum Order Amount | 10 Cont |
| Index Price (Average of the prices in Spot Market) |
Kraken 25% |
| Bitstamp 25% | |
| Coinbase 25% | |
| Gemini 25% |
| Position Level（Cont） | Maintenance Margin Rate | Minimum Initial Margin Rate | Maximum Leverages |
| 0-500000 Cont | 0.50% | 1.00% | 100 |
| 500001-1000000 Cont | 1.00% | 2.00% | 50 |
| 1000001-2000000 Cont | 1.50% | 3.33% | 30 |
| 2000001-5000000 Cont | 2.00% | 5.00% | 20 |
| 5000001-10000000 Cont | 2.50% | 6.66% | 15 |
| 10000001-20000000 Cont | 3.00% | 10.00% | 10 |
ETHUSD
| Contract | ETHUSD |
| Trading Unit | * Cont |
| Contract Value | 1 USD |
| Quote Currency | USD |
| Settlement Coin | ETH |
| Minimum Order Amount | 10 Cont |
| Index Price (Average of the prices in Spot Market) |
Kraken 25% |
| Bitstamp 25% | |
| Coinbase 25% | |
| Gemini 25% |
| Position Level（Cont） | Maintenance Margin Rate | Minimum Initial Margin Rate | Maximum Leverages |
| 0-500000 Cont | 0.50% | 1.00% | 100 |
| 500001-1000000 Cont | 1.00% | 2.00% | 50 |
| 1000001-2000000 Cont | 1.50% | 3.33% | 30 |
| 2000001-5000000 Cont | 2.00% | 5.00% | 20 |
| 5000001-10000000 Cont | 2.50% | 6.66% | 15 |
| 10000001-20000000 Cont | 3.00% | 10.00% | 10 |