How to make money from MEXC contract trading

Understanding MEXC contract trading equips you to exploit price movements in the cryptocurrency market, empowering you to make informed trading decisions.

Nov 11, 2024 at 09:26 am

How to Make Money from MEXC Contract Trading: A Comprehensive Guide

MEXC contract trading offers traders a unique opportunity to profit from price movements in the cryptocurrency market. By understanding the basics of contract trading and following a systematic approach, traders can increase their chances of success. This detailed guide will provide you with a comprehensive understanding of MEXC contract trading, enabling you to navigate the market effectively and make informed decisions.

Understanding MEXC Contract Trading

1. What are MEXC Contracts?

MEXC contracts are financial instruments that allow traders to speculate on the price movements of cryptocurrencies without owning the underlying assets. They are similar to futures contracts, but with some key differences. Unlike futures contracts, MEXC contracts do not have a fixed expiration date and can be held indefinitely. They are also settled in USDT, the stablecoin issued by Tether, which provides traders with greater flexibility and stability.

1. Types of MEXC Contracts

MEXC offers two types of contracts: Linear Contracts and Inverse Contracts. Linear contracts are the most straightforward type of contract, with a simple pay-off structure that is directly proportional to the contract's reference index price. Inverse contracts, on the other hand, are more complex and involve a perpetual swap mechanism. The pay-off structure of inverse contracts is based on the funding rate, which is a fluctuating fee paid by traders who hold opposite positions.

1. Advantages of MEXC Contract Trading

• High Leverage: MEXC offers leverage of up to 100x on linear contracts and 50x on inverse contracts, allowing traders to control a large amount of capital with a relatively small investment.
• Low Fees: MEXC has competitive trading fees, with a maker fee of 0.02% and a taker fee of 0.04%.
• Deep Liquidity: MEXC's order book is one of the deepest in the industry, ensuring fast execution and low slippage.
• Variety of Trading Instruments: MEXC offers a wide range of trading instruments, including perpetual contracts, futures contracts, and spot trading pairs.

Getting Started with MEXC Contract Trading

1. Create a MEXC Account

To start trading contracts on MEXC, you need to create an account. The registration process is straightforward and can be completed in a few minutes. You will need to provide basic personal information and complete the KYC (Know Your Customer) process.

1. Fund Your Account

Once your account is created, you need to fund it with USDT. You can deposit USDT directly from your bank account, crypto wallet, or credit card. MEXC supports multiple deposit methods, making it convenient for traders to fund their accounts.

1. Choose a Trading Instrument

MEXC offers a wide range of trading instruments, including perpetual contracts, futures contracts, and spot trading pairs. Choose the trading instrument that best suits your trading style and risk tolerance. Perpetual contracts are suitable for short-term trading, while futures contracts are more appropriate for long-term strategies. Spot trading pairs allow you to buy and sell the underlying cryptocurrencies.

Executing a Trade

1. Place an Order

To place an order, select the trading instrument and enter the desired price and quantity. You can choose between limit orders, market orders, and stop orders. Limit orders allow you to specify a specific price at which you want to execute your trade, while market orders execute immediately at the current market price. Stop orders are used to enter or exit a trade when the price reaches a predetermined level.

1. Manage Your Trade

Once you have placed an order, you need to manage it actively. You can adjust the order price or quantity, cancel the order, or close the position at any time. MEXC provides a user-friendly trading interface that makes it easy to manage your trades.

1. Settle Your Position

When you close a position, you need to settle it by paying the settlement value. The settlement