How to Sell Short in Linear Futures Contracts

How to multiply profits through opening sell-short positions when the price goes down?

Suppose that you had 2,000 USDT, and use 10X leverage to sell/short 1 BTC in BTCUSDT trading market. The PNL is calculated as follows:

1 * (20,000-15,000)= 5,000 USDT.

Position Amount Opening Price Closing Price PNL
1 BTC 20,000 USDT 15,000 USDT 5,000 USDT

However, if you use spot trading, you can not profit from short selling.

Note: To simplify the calculation of the above process, the calculation of premium, margin profit and loss, transaction fees, and capital fees are ignored.

 

Take Cross position with 10X leverage to sell short in the BTCUSDT futures market as an example:

1. Enter the futures trading page

Visit CoinEx official website (https://www.coinex.com), click [Futures] on the top to enter the transaction page, and select the Futures trading pairs.

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2. Transfer the assets to the futures account

Click [Transfer], select [From Spot to Futures], select [USDT], enter the [Amount], and then click [Submit] to complete the transfer.

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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.

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4. Open a position/sell BTC at a higher price

Take limit order as an example:

Set the [Price] and [Amount] in the BTCUSDT contract market and click [Sell BTC] to complete the order.

(1) The sell/short will be completed when the order is executed, and you can view the position details in the [Current Position].

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(2) The sell/short will be completed when the order is executed, and you can view the  position details in the [Current Position]

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5. Close the position/buy BTC at a lower price when it drops to the expected price

Method 1: Buy the number of positions in order placement area to close the position.

Take limit order as an example here:

Set the [Price] and [Amount] in BTCUSDT 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 amount. If it is greater than the position amount, the position will be held in the opposite direction after the order is executed.

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Method 2: Close the position at the current position.

Take limit order as an example:

Set the [Price] and [Amount] on the BTCUSDT contract market, and then click [Close Position] to complete the delegation. When the order is executed, the close/buy will be completed.

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Method 3: Use [Close All], [Take Profit or Stop Loss] to close the position.

When a position is closed by [Take Profit or Stop Loss], [Close All] on future trading, the closing order will be executed with the Auction-style Liquidation Strategy.

For more details, please refer to:

Auction-style Liquidation Strategy

Take Profit & Stop Loss in Futures Trading

 

6. Transfer the assets to the spot account

Click [Transfer] on the contract transaction page, select [From Futures to Spot], select [USDT] coin, enter the [Amount], and then click [Submit] to complete the transfer.

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Risk Reminder

Futures 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 your prediction. Therefore, we strongly advise entry-level users NOT to use high-leverage trading to avoid forced liquidation or even bankruptcy.