Futures Trading
Futures Trading is HIGH risk! Trade only what you can afford to lose!
CryptoHero offers Futures trading capability in addition to Spot trading. The trading principles for Futures is very different from Spot. There are two main key differences:
Futures allows you to short a coin without you owning that coin
Futures allows you to leverage your capital
These two advantages often make Futures trading appealing to traders. All Futures traders need to be aware of is this very important metric called the Margin Ratio.
Please note that funds for Futures trading are often segregated in the Futures wallet. Please ensure there are funds in your Futures wallet.
What is Margin Ratio?
In simple terms - It is the liquidation risk of the current position. The higher the ratio (in percentage terms), the higher the chance your position will be automatically liquidated by the exchange. All Futures traders need to keep an eagle eye on the Margin Ratio in order not to risk their positions getting liquidated and hence, wiping out most if not all of their invested capital.
Whenever the Margin Ratio is high, the trader will need to inject more capital in order to reduce the Margin Ratio.
Applying Leverage
Futures trading is all about leverage. Leverage allows a trader to amplify his returns using a small amount of capital. How much leverage a trader can take depends on the exchange that grants him or her the maximum leverage.
We highly recommend traders to read more on Futures trading
Trading Futures On CryptoHero
Futures trading contains its own set of parameters that are vastly different from spot trading. Hence, the design and development of Futures trading on CryptoHero was slow but deliberate. Our team's sole aim was to make Futures trading intuitive and user-friendly without affecting the current experience of operating CryptoHero.
Hence, CryptoHero has introduced a new type of exchange API connection called Futures API. A user will need to select the exchange for Futures trading. Please ensure that Futures Trading permission has been enabled when adding the API keys for the Futures API.
Again, please ensure that Futures Trading permission has been enabled for the exchange that you want to trade Futures on
Once a Futures exchange is selected, CryptoHero will change the presented information and UI automatically. Trading Terminal will also not be available when Futures trading API is selected.
Each bot will operate as usual but with more information required from the user in order to trade a futures position.
The first difference is that a user will now need to choose the type of assets available for Futures trading. Based on the screenshot above, a user can select to trade Stablecoins or Coin assets on either Perpetual or Time-limited Delivery.
Email us if you want CryptoHero to support Futures trading for your exchange if we do not currently support it.
After a user has selected the asset to trade, the user will need to set the Leverage. CryptoHero has made it easy for the user by automatically calculating the amount of capital (the Margin Cost) required based on the Max Position Size.
IMPORTANT: Futures Trading uses funds from your exchange's Futures wallet. If your available fund is zero, check your Futures wallet in your exchange.
What Is Max Position Size?
It is the total amount of capital that includes the leverage on the actual capital invested. So, let's say you have 10 USDT of actual capital and would like to have a 10x leverage, your maximum position size allowed would be 10 x 10 = 100 USDT.
The margin cost will change depending on the leverage taken.
Although it is enticing to select as high a leverage as possible, do bear in mind that the margin ratio will also be higher and the chances of your position getting liquidated is higher too.
Mark Price Versus Last Price
CryptoHero allows you to determine the price source that will be used to determine entry and exit conditions. For Futures trading, Mark price is an average of the last traded price movements as determined by the exchange. Mark price often lags Last price. Hence, Mark Price is very useful if a trader wants to remove sudden price movements from consideration.
The rest of the bot's settings are intentionally kept the same in order to allow our users easy adaptation to Futures trading.
WARNING: Futures Trading is High Risk! Trade only what you can afford to lose!
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