Margin Trading
Last updated
Last updated
On KTX.Finance, users have the option to open leveraged positions on an asset through the execution of either a 'Long' or 'Short' trade.
Long position
When executing a 'Long' position, users speculate that the future price of the asset will exceed the current price.
Short position
Conversely, when executing a 'Short' position, users speculate that the future price of the asset will be below the current price.
Trade with leverage on KTX.Finance here
New users have to "Enable Leverage" and "Approve Collateral" when they trade on KTX.Finance.
After completing the previous step, Click on "Long" or "Short" depending on which side you would like to open a leverage position on.
Example: Traders initiate the process by selecting the "Long" button, indicating their intent to open a leveraged long position. Traders input the amount of collateral they wish to use and specify the desired leverage multiple. For instance, if a trader decides to utilize 100 MNT worth 68.68 USD, they can then determine the leverage multiple. Based on the entered collateral and chosen leverage, the platform calculates the size of the long position. In the provided example, a long position of size 1689.17 USD is achievable with the specified collateral and leverage.
And you can see more details in the Order Summary below. The Entry Price is $2490.60 and the Liquidation Price is $2406.01. More details about fees can be found in Margin Trading Fees.
While trades on KTX.Finance aim to avoid price impacts, the inherent nature of blockchain transactions introduces the possibility of price movements during the confirmation phase. The confirmation time on the blockchain can vary based on network conditions, leading to potential discrepancies between the initially submitted trade details and the final confirmation.
Slippage is the difference between the expected price of the trade and the execution price. The default slippage is set at 0.3%, and you can tick the box "Allow up to 1% slippage" to change the slippage to 1%.
Open positions can be view under the "Positions Tab".
Users can take various actions to manage their position:
Deposit: allows you to deposit additional collateral to reduce your leverage, click on the "Pencil Icon"
Withdraw: allows you to withdraw existing collateral to increase your leverage, click on "Pencil Icon"
Close: allows you to partially or completely close a trade
Leverage for a position is displayed as (position size) / (position collateral). You can see the remaining leverage of your positions in the Position tab
Note that when choosing a token as collateral, a swap fee will be incurred if a different collateral asset than that required was chosen. This is to prevent deposits from being used as a zero fee swap. This does not apply to shorts. Withdrawing of collateral from longs and shorts do not have this fee as well.
You can close a position partially or completely in the Close Positions of Position Tab. The amount for the order can be entered in the close position order column.
You can choose to close your position at a limit price or at a market price.
For long positions, profits are paid in the asset you are longing, e.g. if you long ETH you would get your profits as ETH.
For short positions, profits will be paid out in BUSD that you used to open the position.
The Liquidation Price is showing in your Position tab. If the token's price crosses this point then the position will be automatically closed and liquidation will happen.
Due to the borrowing fee your liquidation price will change over time, especially if you use a leverage that is more than 10x and have the position open for more than a few days, so it is important to monitor your liquidation price.
If there is any collateral remaining after deducting losses and fees, then the corresponding amount would be returned to your account.
More info can be seen on the Liquidation Fee and Liquidation Price.
Order Types
Definition
Execution
Execution Price
Market Order
An order to buy or sell as quickly as possible at at the best available market price
The order will be executed immediately
Mark Price
Limit Order
An order to buy or sell with a restriction on the maximum price paid or the minimum price to be received
When the mark price reaches the order price, the order will be executed
Order Price
Take Profit Order
Type of limit order specifies the that specifies the exact price at which to close out an open position for a profit
When the Mark Price reaches the trigger price, the Take Profit order will be executed
Trigger Price
Stop Loss Order
An order to limit trader’s loss or lock in a profit on an existing position by closing out a position if the price reaches specific level
When the Mark Price reaches the trigger price, the Stop Loss Order will be executed
Trigger Price
You can also set stop-loss and take-profit orders by clicking on the "Close" button and selecting the "Trigger" tab.After creating a trigger order, it will appear in your position's row as well as under the "Orders" tab, you can edit it the order and change the trigger price if needed.If you close a position manually, the associated trigger orders will remain open, you would need to cancel them manually if you do not want the order to be active when opening future positions.Note that orders are not guaranteed to execute, this can occur in a few situations including but not exclusive to:
The mark price which is an aggregate of exchange prices did not reach the specified price
The specified price was reached but not long enough for it to be executed
No keeper picked up the order for execution
Additionally, trigger orders are market orders and are not guaranteed to execute at the trigger price.
