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How to calculate BitMEX contract returns

To determine returns on BitMEX contracts, subtract the opening price from the closing price, divide the result by the opening price, and factor in any fees or commissions.

Nov 10, 2024 at 09:56 pm

How to Calculate BitMEX Contract Returns

Traders on BitMEX can earn returns on their investments by trading futures contracts. Returns are calculated based on the difference between the opening price and the closing price of a contract, as well as any fees or commissions that may be charged.

Steps to Calculate BitMEX Contract Returns

  1. Determine the Opening and Closing Prices

The first step is to determine the opening and closing prices of the contract. The opening price is the price at which the contract was purchased, and the closing price is the price at which the contract was sold.

  1. Calculate the Profit or Loss

The profit or loss on a contract is calculated by subtracting the opening price from the closing price. If the result is positive, then the trader has made a profit. If the result is negative, then the trader has lost money.

  1. Calculate the Return

The return on a contract is calculated by dividing the profit or loss by the opening price. The result is expressed as a percentage.

  1. Consider Fees and Commissions

When calculating returns, it is important to consider any fees or commissions that may have been charged. These fees and commissions can reduce the trader's return.

Advanced Concepts

Example Calculation

Let's say a trader purchases a BitMEX contract at a price of $10,000. The trader holds the contract for one day and sells it at a price of $10,500.

The profit on the contract is $500. The return on the contract is 5%, calculated as follows:

Return = (Profit / Opening Price) * 100%

Return = ($500 / $10,000) * 100%

Return = 5%

Factors Affecting Returns

The returns on BitMEX contracts can be affected by several factors, including:

  • The underlying asset price
  • The contract's leverage
  • The trader's risk tolerance
  • The market conditions
  • Trading strategy

Disclaimer:info@kdj.com

The information provided is not trading advice. kdj.com does not assume any responsibility for any investments made based on the information provided in this article. Cryptocurrencies are highly volatile and it is highly recommended that you invest with caution after thorough research!

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