Mobile CoinEx contract operation process

To ensure informed contract trading on the CoinEx mobile app, understanding perpetual contracts, risk management strategies, and the funding mechanism is paramount.

Nov 30, 2024 at 08:09 am

Mobile CoinEx Contract Operation Process

CoinEx Mobile app provides perpetual contract trading on the go, offering up to 100x leverage. For traders new to the contract market, it is crucial to familiarize yourself with the intricate steps involved in futures trading to manage risk effectively and improve profitability. This comprehensive guide will delve into the inner workings of contract operation on CoinEx mobile app, empowering you with the knowledge necessary for successful contract trading.

Step 1: Understanding Perpetual Contracts

Before embarking on contract trading, it is imperative to comprehend the nature of perpetual contracts. Unlike traditional futures contracts that have a fixed expiration date, perpetual contracts are perpetual in nature, meaning they do not expire. This allows traders to maintain their positions indefinitely or until they decide to close them manually.

Step 2: Choosing a Trading Pair

The CoinEx mobile app offers a wide selection of trading pairs for perpetual contracts. Each trading pair represents a particular cryptocurrency that can be traded against Tether (USDT) or Bitcoin (BTC). Choose a trading pair that aligns with your market understanding and risk appetite.

Step 3: Margin Trading and Leverage

Margin trading is a distinctive feature of contract trading that enables traders to amplify their trading positions. When initiating a contract trade, you are required to post a certain amount of funds as margin, which serves as collateral for your position. Leverage is the ratio of the margin to the total trade size. For instance, if you trade with 10x leverage, your trading position would be 10 times the size of your initial margin. Leverage magnifies both potential profits and losses, so it is crucial to manage it prudently.

Step 4: Opening a Position

Once you have selected a trading pair and chosen an appropriate leverage, you can initiate a contract trade by placing a buy or sell order. A buy order indicates that you anticipate the price of the cryptocurrency to increase, while a sell order reflects your expectation of a price decrease. Specify the order size, which represents the number of contracts you wish to trade, and click on "Buy/Long" or "Sell/Short" to execute the trade.

Step 5: Adjusting Positions and Take Profit

After opening a position, you can adjust its parameters based on market conditions. If the market moves in your favor, you can add to your position by placing additional buy or sell orders. Conversely, if the market moves against you, you may consider reducing your position to mitigate potential losses. Take profit orders allow you to lock in profits automatically when the price reaches a predetermined level.

Step 6: Closing a Position

To close a contract position, simply place an order in the opposite direction of your original trade. For example, if you opened a long position by buying a contract, you would close it by selling the same number of contracts. Closing a position will realize your profits or losses, depending on the difference between the opening and closing price.

Step 7: Managing Risk

Effective contract trading requires a robust risk management strategy to minimize potential losses and preserve capital. Establish clear entry and exit points for your trades, set stop-loss orders to automatically close positions when the price falls below a predetermined level, and monitor your open positions diligently to make timely adjustments if necessary.

Step 8: Funding and Settlement

Perpetual contract trading involves a funding mechanism to maintain market neutrality. If the majority of traders hold long positions, they pay funding to traders holding short positions. Conversely, if the majority holds short positions, they receive funding from traders holding long positions. Funding is settled every 8 hours, and the rate is determined by the market supply and demand.