NEX supports perpetual margin trading. Traders can provide collateral and borrow funds from the NIT pool, which allows them to further capitalize on the future price movements of an underlying asset through leverage. This also means that the trader can access larger capital with less collateral required.
For example, you have $10,000 and would like to open a position worth $30,000. This will not be an issue, since you can trade with 3x leverage. But when taking a leverage, every price movement will also be multiplied by 3.This means that, if ETH price is $1,000 and it drops by $100, you will earn $300 if you hold a short position, or lose $300 if your position is long. More opportunities always come with more risks!
Trading perpetuals means a margin position can remain open as long as the trader wishes, given they have enough collateral to maintain the position.
The experience of perpetual trading on NEX is quite similar to other decentralized exchanges. Here is a quick guide of your perpetual trade on NEX:
- 1.Connect your wallet to NEX.
- 2.Open position by choosing an asset, position size and leverage.
- 3.Collateral for this position is sent to the perpetual contract.
- 4.Funds that are lent out for leverage are reserved from the NIT pool.
- 5.Closing your position results in the funds being settled, with your receiving initial collateral and profits minus the funds you borrowed for leverage.