In contract trading, the initial margin refers to the amount of collateral required to open a position. The amount of initial margin is affected directly by the position and leverage. Under the same position, the higher the leverage, the lower the initial margin required; under the same leverage, the higher the position, the higher the initial margin required.
Coin-margined contract (inverse contract):
Initial Margin = Open Position Quantity x Contract Face Value / (Leverage Multiplier x Opening Avg. Price)
- Example:
Trader uses 25x leverage and submits a limit order of 10,000 BTCUSD at a price of 30,000. The face value of the contract is 1 USD each, then the user's initial margin = 10,000 x 1 / (30,000 x 25) = 0.0133 BTC
Coin-margined contracts (Inverse contract)：Order cost =opening quantity x contract face value/(leverage multiple x average opening price)
USDT-margined contracts (Forward contract)：Order cost = average opening price x opening quantity x contract face value/leverage multiple
- For example(Inverse contract)：
If a trader submits a limit order of 10,000 BTCUSD at a price of 7,000 with 25x leverage, and the face value of the contract is 1 USD each, the user's margin will be calculated as follows:
The user's margin = 10000x1/（7000x25）= 0.0571 BTC - For example(Forward contract)：
If a trader submits a limit order of 10,000 BTCUSD at a price of 7,000 with 25x leverage, and the face value of the contract is 0.0001 BTC each, the user's margin will be calculated as follows:
The user's margin= 10000x1x7000/25= 280 USDT
Margin in cross position mode includes initial position margin and available balance.