Poloniex contract trading rules

To begin contract trading, Poloniex traders select a trading pair (e.g., BTC/USDT), choose a contract type (perpetual or futures), set leverage, place an order (limit or market), manage their position, and close it with an opposite order to realize gains or losses.

Nov 23, 2024 at 04:58 am

Poloniex Contract Trading Rules

Poloniex is a popular cryptocurrency exchange that offers a variety of trading options, including spot trading, margin trading, and contract trading. Contract trading, also known as futures trading, allows traders to speculate on the future price of a cryptocurrency without having to own the underlying asset.

Poloniex Contract Trading Rules

To participate in contract trading on Poloniex, traders must first create an account and deposit funds into their account. Once they have funds in their account, they can begin trading contracts.

1. Choose a Trading Pair

The first step is to choose a trading pair. A trading pair is a pair of cryptocurrencies that are traded against each other. For example, the BTC/USDT trading pair represents the price of Bitcoin in terms of Tether.

2. Select a Contract Type

Once you have chosen a trading pair, you need to select a contract type. Poloniex offers two types of contracts: perpetual contracts and futures contracts.

• Perpetual contracts are contracts that do not have an expiration date. This means that traders can hold a perpetual contract for as long as they want.
• Futures contracts are contracts that have an expiration date. This means that traders must close out their futures contracts before the expiration date.

3. Set the Leverage

Leverage is a tool that allows traders to magnify their profits and losses. When you trade with leverage, you are essentially borrowing money from the exchange to increase the size of your trade.

4. Place an Order

Once you have set the leverage, you can place an order. There are two types of orders that you can place: limit orders and market orders.

• Limit orders are orders that are executed at a specific price. For example, you could place a limit order to buy 1 BTC at $10,000.
• Market orders are orders that are executed at the current market price. For example, you could place a market order to buy 1 BTC at the current market price of $10,100.

5. Manage Your Position

Once you have placed an order, you need to manage your position. This involves monitoring the market price and adjusting your strategy as needed.

6. Close Your Position

When you are ready to close your position, you can do so by placing an opposite order. For example, if you bought 1 BTC at $10,000, you could close your position by selling 1 BTC at $10,100.

Conclusion

Contract trading on Poloniex is a powerful tool that can be used to generate profits. However, it is important to understand the risks involved before you start trading. If you are not comfortable with the risks involved, you should not trade contracts.