Risks

• Does trading Perpetual Futures have risk?

  • Yes trading Perpetual Futures inherently carries many risks. Some risks are common to trading traditional futures (such as price risk to volatile underlying assets). Other risks are unique to Perpetual Futures (such as risks with the funding rate process). It is your responsibility to ensure that you understand these risks fully before trading.

• Can I lose more than my initial investment?

  • Yes because Perpetual Futures involve the use of leverage, losses can exceed the amount of the initial investment.

• How does leverage change risk?

  • Because Perpetual Futures involve the use of leverage, both profits and losses are amplified and involve more risk.

• What are some risks from the funding rate process of Perpetual Futures?

  • Because the funding rate is dynamically calculated and dependent on market conditions, holding Perpetual Futures positions exposes users to additional risk.

• What tools are available to help manage risk?

  • The exchange shows various metrics to help users understand their risk picture, including displaying up-to-date margin information. Additionally, users can use standard common order types, like stop-loss orders, to limit potential losses.