How to play the contract game?
Before playing the game, you must first understand the game rules, so that you can establish a foothold in the game. Remember, this is the foundation for standing firm, not a trick to win.
I found that many friends haven’t even figured out the fee rate rules, yet they dare to directly open contracts at 50x or 100x leverage. That's too impulsive! I used to do this too, but thinking back, it’s not much different from going to a casino.
Now let's talk about a few basic concepts in contracts: (I will assume everyone is an ordinary player, and the fees are calculated based on BNB discounts)
Transaction Fee: For opening and closing positions at market price, a transaction fee of 0.05% is charged each time, which means a total of 0.1% for both. Sounds small, right? But don’t forget about your leverage. With 20x leverage, the fee rises to 2%; with 100x leverage, it skyrockets to 10%. For a 100U contract at 100x leverage, the transaction fee would be nearly 10U.
Remember: Leverage is not a shortcut to wealth; it is a tool that can bring you back to square one overnight.
Closing Fee: 1.5%. Don’t think that for a 100U contract at 100x leverage, a drop of 1% will only lead to closing. You also have to consider the transaction fee and closing fee. With the isolated margin mode, a drop of 0.5% might already trigger a liquidation.
Remember: Never let the system force you to close a position; set a stop-loss above the forced liquidation line. This is at least better than being forcibly liquidated by the system. (However, I do not recommend setting the stop-loss line too low.)
Mark Price: This calculation can be a bit complex; just understand it as a price with more stable fluctuations than the latest price.
Suggestion: When setting the trigger price, use the mark price.
Isolated Margin & Cross Margin:
Cross Margin means using all the money in your contract account as margin, regardless of how much you used to open the position.
Isolated Margin only uses the portion of money used to open the position as margin, leaving the rest of the account funds untouched.
Both modes have their pros and cons; choose based on the actual situation. If there are open contracts in the account, you cannot switch modes; you must close all trades to switch.
At this point, you have just touched the threshold of the contract game.
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