MEXC provides traders with flexible options, allowing users to choose between USDT-M perpetual futures or Coin-M perpetual futures based on their personal preferences. Additionally, MEXC supports both long and short positions, enabling traders to execute trading strategies more precisely amid market fluctuations. Most importantly, users can flexibly set margin modes and adjust leverage multipliers. These convenient features make MEXC an ideal platform to meet the diverse needs of traders.
1.1 USDT-M Perpetual Futures
USDT-M perpetual futures refer to contracts where the quote and settlement unit is USDT (Tether). The value and PNL calculations of USDT-M perpetual futures are based on USDT as the reference crypto. This contract design aims to mitigate the impact of crypto price volatility on traders because USDT is a stablecoin pegged to the U.S. dollar, offering relatively stable value.
Therefore, the main advantage of USDT-M perpetual futures is the ability to calculate returns in fiat currency. For instance, when you earn a profit of 1,000 USDT, you can easily assess the profit as nearly equivalent to 1,000 USD, as the value of 1 USDT is approximately 1 USD.
1.2 Coin-M Perpetual Futures
Coin-M perpetual futures refer to contracts where a specific crypto (such as Bitcoin or Ethereum) is used as margin and for PNL calculations. In these contracts, USD serves as the quote unit. The value of each Coin-M perpetual futures contract is a fixed amount in USD. For example, a Bitcoin-M perpetual futures contract may have a size of 100 USD per contract.
2.1 One-Way Mode
In one-way mode, investors hold only long or short positions in futures trading (including USDT-M futures and Coin-M futures). If investors believe that the price of a certain futures asset will rise, they may hold a long position. Conversely, if they believe the price will fall, they may hold a short position. This position mode links the investor's PNL to the direction of the futures asset's price changes.
2.2 Hedge Mode
In hedge mode, users are able to simultaneously hold long and short positions in a given futures pair, and the leverage can be set independently for both long and short directions. All long positions are combined within each futures contract, and likewise, all short positions are combined. When holding hedge positions, margin needs to be allocated for both the long and short positions corresponding to the risk limit tier.
For example, in BTCUSDT perpetual futures, a user can open a long position with 25x leverage and simultaneously open a short position with 50x leverage.
3.1 Isolated Margin
In isolated margin mode, each position has an independent margin account. This means that each position has its own margin balance, and any losses can only be covered by the margin associated with that specific position. The maximum potential loss for an isolated margin position is the sum of the initial margin and any additional margin added to that specific position. Such an arrangement ensures that the losses of one position do not impact others, thereby limiting the scope of potential losses.
The advantage of the isolated margin model lies in allowing traders to have more precise control over the risk of each position. Users can manually add margin to isolated margin positions, optimizing the liquidation price for each position.
3.2 Cross Margin
In cross margin mode, all positions share a common margin account. When utilizing the cross margin mode, a user's available margin is dedicated specifically to support the corresponding cross margin positions and is not used as margin for other cross margin positions.
The cross margin mode may be more suitable for traders who wish to utilize their funds more flexibly, but it also requires greater caution since losses may impact the entire account. Currently, MEXC supports switching from isolated margin mode to cross margin mode for an existing position, but not the reverse.
MEXC allows users to set different leverage multipliers for long and short positions. Users can adjust the leverage multiplier in the isolated margin mode, or switch from isolated margin mode to cross margin mode. It is important to note that currently, MEXC does not support switching from cross margin mode to isolated margin mode. At present, MEXC supports leverages ranging from 1x to 200x for USDT-M perpetual futures and from 1x to 125x for Coin-M perpetual futures.
In summary, MEXC caters to the varied requirements of traders seeking efficient, flexible, and secure futures trading. This is achieved by offering a range of futures options, flexible margin modes, high leverages, among other features.
Disclaimer: This information does not provide advice on investment, taxation, legal, financial, accounting, or any other related services, nor does it constitute advice to purchase, sell, or hold any assets. MEXC Learn provides information for reference purposes only and does not constitute investment advice. Please ensure you fully understand the risks involved and exercise caution when investing. The platform is not responsible for users' investment decisions.