# Margining

Opening a contract position requires a certain amount of margin, and margin trading provides greater leverage for your contracts.

* **Initial Margin:**\
  The minimum margin required for opening a position.\
  Initial margin ratio = 1/leverage.\
  Initial margin = (Contract Quantity × Order Price × Multiplier​) / Leverage
* **Maintenance Margin Ratio:**\
  Maintenance Margin is the minimum amount of margin a trader must maintain in their position or account to continue holding a position. When unrealized losses cause the position margin in a position or account to fall below the required maintenance margin level, liquidation will be triggered.

***

## USDT-Margined Contracts Overview

**Margin**

All varieties of USDT Perpetual contracts use USDT as the collateral asset. Users only need to hold USDT to participate in trading various contract types.

**Pricing Unit**

The USDT Perpetual contracts are denominated in USDT.

**Contract Value**

The value of each USDT perpetual contract corresponds to the underlying asset. For instance, in the BTC/USDT contract, the contract value is 0.001 BTC.

**Profit and Loss Currency**

All varieties of USDT Perpetual contracts calculate profits and losses in USDT.

**Contract Specifications**

| **Trading Pair** | **Contract Value** | **Collateral Currency** | **Maximum Leverage** | **Maintenance Margin Rate** |
| ---------------- | ------------------ | ----------------------- | -------------------- | --------------------------- |
| BTC-USDT         | 0.001 BTC          | USDT                    | 20X                  | 2.5-50.0%                   |

*\*May be adjusted in the future.*

### Position Limits and Maintenance Margin Rates\*

**Main Zone USDT-Margined Contracts**\
Established assets with deep liquidity.

* BTC-USDT, ETH-USDT, SOL-USDT

<table data-full-width="true"><thead><tr><th width="82">Tier</th><th width="128">Lower Limit</th><th width="128">Upper Limit </th><th width="144">Max Leverage</th><th width="86">MMD</th><th>Maintenance Amount (USDT)</th></tr></thead><tbody><tr><td>1</td><td>0</td><td>50,000</td><td>20x</td><td>0.5%</td><td>0</td></tr><tr><td>2</td><td>50,000</td><td>100,000</td><td>20x</td><td>1.0%</td><td>250</td></tr><tr><td>3</td><td>100,000</td><td>200,000</td><td>20x</td><td>2.0%</td><td>1,250</td></tr><tr><td>4</td><td>200,000</td><td>250,000</td><td>20x</td><td>2.5%</td><td>2,250</td></tr><tr><td>5</td><td>250,000</td><td>500,000</td><td>10x</td><td>5.0%</td><td>8,500</td></tr><tr><td>6</td><td>500,000</td><td>1,000,000</td><td>5x</td><td>10.0%</td><td>33,500</td></tr><tr><td>7</td><td>1,000,000</td><td>1,250,000</td><td>4x</td><td>12.5%</td><td>58,500</td></tr><tr><td>8</td><td>1,250,000</td><td>2,500,000</td><td>2x</td><td>25%</td><td>214,750</td></tr><tr><td>9</td><td>2,500,000</td><td>5,000,000</td><td>1x</td><td>50%</td><td>839,750</td></tr></tbody></table>

**Frontier Zone USDT-Margined Contracts**\
Emerging markets with high volatility and growth potential.

<table data-full-width="true"><thead><tr><th width="82">Tier</th><th width="128">Lower Limit</th><th width="128">Upper Limit </th><th width="144">Max Leverage</th><th width="86">MMD</th><th>Maintenance Amount (USDT)</th></tr></thead><tbody><tr><td>1</td><td>0</td><td>25,000</td><td>20x</td><td>2.5%</td><td>0</td></tr><tr><td>2</td><td>20,000</td><td>200,000</td><td>10x</td><td>5%</td><td>625</td></tr><tr><td>3</td><td>200,000</td><td>500,000</td><td>5x</td><td>10%</td><td>10,625</td></tr><tr><td>4</td><td>500,000</td><td>750,000</td><td>4x</td><td>12.5%</td><td>23,125</td></tr><tr><td>5</td><td>750,000</td><td>1,500,000</td><td>2x</td><td>25%</td><td>116,875</td></tr><tr><td>6</td><td>1,500,000</td><td>3,000,000</td><td>1x</td><td>50%</td><td>491,875</td></tr></tbody></table>

*\*May be adjusted in the future.*

### Margin and Profit/Loss Calculation

**Initial Margin**

In USDT Perpetual contracts, the Initial Margin is calculated using the order value multiplied by the Initial Margin rate. The Initial Margin rate depends on the Leverage used.

Initial Margin Formula:

Initial Margin = (Contract Quantity × Order Price × Multiplier​) / Leverage

Example:

* Trader opens a Long BTC-USDT position of 100 contracts, each sizing 0.01 BTC, at a price of 10,000 USDT using 50x leverage.

Calculation:

`Initial Margin = (100×10,000×0.01) / 50 ​= 200 USDT`

### **Profit and Loss (PNL)**

After opening a position, the PNL can be seen in real-time based on market price changes. The calculation differs depending on whether the position is long or short.

#### **For Long positions**

Example:

* Trader B holds a Long position of 0.2 BTC-USDT with an Entry Price of 7,000 USDT. The latest Market Price shows 7,500 USDT.

**PNL Calculation:**

`PNL = Contract Quantity × (Latest Price − Entry Average Price) = 0.2 × (7,500−7,000) = 100 USDT`<br>

**For Short positions**

Example:

* Trader C holds a Short position of 0.4 BTC-USDT with an Entry Price of 6,000 USDT. The latest Market Price shows 5,000 USDT.

#### **PNL Calculation:**

`PNL = Contract Quantity × (Entry Average Price − Latest Price) = 0.4 × (6,000 − 5,000) = 400 USDT`

#### **Average Entry Price**

The Average Entry Price is recalculated whenever new positions are opened. The formula is as follows:

Average Entry Price Formula:

`Average Entry Price =`

`[( ContractQty1 x EntryPrice1 ) + ( ContractQty2 x EntryPrice2 ) + …] /`\
`( ContractQty1 + ContractQty2 + … )`

***

## ALTCOIN-margined Contracts Overview

**Margin**

ALTCOIN-M contracts are derivatives that allow the use of currencies other than the pricing currency and base currency as a margin for opening trading positions.\
\
For example, the LN-ETH-USDT contract uses LN as the margin for two contracts.

**Pricing Unit**

ALTCOIN-M contracts also use USDT as the pricing unit.

**Contract Value**

The contract value for ALTCOIN-M contracts is typically 0.01 ETH, although this is subject to the configuration of each contract.

**Profit and Loss Currency**

The profit and loss for ALTCOIN-M contracts are settled in the corresponding margin currency. For instance, the LN-ETH-USDT contract is settled in LN.

**Contract Specifications**

<table data-header-hidden><thead><tr><th width="210"></th><th></th><th></th><th></th><th></th></tr></thead><tbody><tr><td><strong>Trading Pair</strong></td><td><strong>Contract Value</strong></td><td><strong>Collateral Currency</strong></td><td><strong>Maximum Leverage</strong></td><td><strong>Maintenance Margin Rate</strong></td></tr><tr><td>LN-ETH-USDT</td><td>0.01 ETH</td><td>LN</td><td>20X*</td><td>2.5-10.0%*</td></tr></tbody></table>

*\*May be adjusted in the future.*

### Position Limits and Maintenance Margin Rates\*

*\*May be adjusted in the future.*

{% hint style="danger" %}
Trading pairs like Altcoin-Margined are affected by fluctuations in the base currency market price. \
\
When the base currency’s price moves, the value of the contract changes accordingly, which in turn adjusts the required maintenance margin rate; this also impacts the margin amount needed to open a position. \
\
Please manage your leverage and margin appropriately to avoid unnecessary losses.
{% endhint %}

**LN-ETH-USDT Contracts**

<table data-full-width="true"><thead><tr><th width="82">Tier</th><th width="128">Lower Limit</th><th width="128">Upper Limit </th><th width="144">Max Leverage</th><th width="86">MMD</th><th>Maintenance Amount (LN)</th></tr></thead><tbody><tr><td>1</td><td>0</td><td>40,000</td><td>20x</td><td>0.5%</td><td>0</td></tr><tr><td>2</td><td>40,000</td><td>80,000</td><td>20x</td><td>1.0%</td><td>200</td></tr><tr><td>3</td><td>80,000</td><td>160,000</td><td>20x</td><td>2.0%</td><td>1,000</td></tr><tr><td>4</td><td>160,000</td><td>200,000</td><td>20x</td><td>2.5%</td><td>1,800</td></tr><tr><td>5</td><td>200,000</td><td>400,000</td><td>10x</td><td>5.0%</td><td>6,800</td></tr><tr><td>6</td><td>400,000</td><td>800,000</td><td>5x</td><td>10.0%</td><td>26,800</td></tr></tbody></table>

### Margin and Profit & Loss Calculation

#### Opening Margin

In ALTCOIN-M contracts, the initial margin is calculated by multiplying the order value by the initial margin rate. The initial margin rate depends on the leverage used.<br>

`Initial Margin = (Contract Quantity × Order Price × Contract Value) / Leverage`

**Example:**\
A trader uses a Leverage of 20x to open a Long position of 100 contracts for 10,000 USDT.\
\
`Initial Margin = (100 × 10,000 × 0.01) / 20 = 500 TOKEN`

#### &#x20;**Average Entry Price**

The Average Entry Price is calculated as follows:&#x20;

`Average Entry Price =`

`[( ContractQty1 x EntryPrice1 ) + ( ContractQty2 x EntryPrice2 ) + …] /`\
`( ContractQty1 + ContractQty2 + … )`

The Average Entry Price will be recalculated whenever a new position is opened.

#### **Profit and Loss**

After opening a position, the position and its Profit and Loss can be viewed in real-time. The formulas for calculating Profit and Loss vary depending on the direction of the trade.

* **For Long positions:**\
  `Profit and Loss = Contract Quantity × (Latest Price − Average Entry Price)`
* **For Short positions:**\
  `Profit and Loss = Contract Quantity × (Average Entry Price − Latest Price)`


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