How to achieve multiple profits through opening short position when the price goes down?
Take an example: Suppose you have 1 BTC, and the price of BTC rises from 15,000 USD to 14,000 USD. In BTCUSD trading market, you sell short BTC with 10X leverage. The PNL are calculated as follows:
10 BTC*(15,000-14,000)=10,000USD.
If you place spot trading with your own assets, you can only buy low and sell high instead of short.
| Position | Opening Price | Closing Price | PNL |
| 10 BTC | 15,000 USD | 14,000 USD | 10,000 USD |
Note: In order to simplify the calculation of the above process, the calculation of premium, margin profit and loss, transaction fees and capital fees are ignored.
Perpetual Contract Page Description
1) Search bar and market selection area
2) Basic contract market area
3) K-line market and depth chart
4) Position type and margin area
5) Fee discount and rate area
6) Order placing area
7) Proportion of buy & sell
8) Market depth area
9) Trade history area
10) Current position and position history area
11) Transaction record area
When judging that the price of BTC will go down, you need to open/sell BTC at a higher price. When BTC drops to the expected price, you can close/buy BTC at a lower price to get profit after settlement of profit and loss. The detailed steps are as follows:
Step 1: Enter the perpetual contract trading page
Step 2: Transfer the assets to the perpetual account
Step 3: Set the margin mode and adjust the leverage
Step 4: Open a position/sell BTC at a higher price
Step 5: Close the position/buy BTC at a lower price when it drops to expected price.
Step 6: Transfer the assets to the spot account
Take an example: Cross position with 10X leverage to short BTC in the BTCUSD market
Step 1: Enter the perpetual contract trading page
1. Visit CoinEx website www.coinex.com, click [Contract] on the top to enter the contract transaction page after successfully logging in.
2. After entering the contract trading page, select the contract trading market. (Take BTCUSD as an example)
Step 2: Transfer the assets to the contract account
Take short BTC as an example, click [Transfer], select [From Spot Account to Perpetual Account], and select [BTC] coin type, set the [Amount] and then click [Submit] to complete the transfer.
Step 3: Set the margin mode and adjust the leverage
Take cross margin mode and 10X leverage as an example, select [Cross Margin] mode and [10X] for leverage.
Step 4: Open a position/sell BTC at a higher price. (Take limit order as an example here)
1. Set the [Price] and [Amount] in the BTCUSD contract market and click [Sell BTC] to complete the order.
2. The sell/short will be completed when the order is executed, and you can view the position details in the [Current Position].
Step 5: Close the position/buy BTC at a lower price when it drops to expected price.
Method 1: Buy the number of positions in order placement area to close the position. (Take limit order as an example here)
1. Set the [Price] and [Amount] in BTCUSD contract market and click [Buy BTC] to complete the order. When the order is executed, the position will be closed/buy.
Note: When closing a position through the order placement area, if you want to completely close the position, the order amount must be the same as the position. If it is greater than the position amount, the position will be held in the opposite direction after the order is executed.
Method 2: Close the position at the current position. (Take limit order as an example here)
Set the [Price] and [Amount] on the BTCUSD contract market, and then click [Close Position] to complete the delegation. When the order is executed, the close/buy will be completed.
Step 6: Transfer the contract assets to the spot account
Click [Transfer] on the contract transaction page, select [From perpetual account to spot account], select [BTC] coin type, set the transfer [Amount] and click [Submit] to complete the transfer.
Risks
Perpetual Contract Trading not only allows you to magnify gains with fewer funds but can also saddle you with amplified losses when the market moves against you. Therefore, we strongly advise entry-level users not to use highly leveraged trading to avoid forced liquidation or even bankruptcy.
Related articles:
Perpetual Contract Introduction
How to Use CET as Transaction Fees?
What are the Differences between Spot Trading, Margin Trading and Perpetual Contract?
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