USDT-Margined Perpetual Contracts use USDT (Tether) as the margin valuation and settlement currency, providing a relatively stable trading environment that is directly pegged to the US dollar for profit/loss calculation.
Basic Definition of Margin
- Margin is the required collateral when opening a position
- Main functions:
i) Maintain open positions;
ii) Cover potential trading losses
- Margin sources:
i) Available assets in the contract account;
ii) Subject to position size limitations
Leverage and Margin Relationship
- Leverage impact:
i) Higher leverage → Less margin required;
ii) Lower leverage → More margin required
- High-leverage characteristics:
i) Enables larger positions with less capital;
ii) Does not alter actual profit/loss ratio;
iii) Warning: Simultaneously amplifies risks
Leverage Usage Recommendations
- Suitable scenarios:
i) Limited capital but desire for larger positions;
ii) High confidence in market trends
- Risk reminders:
i) High leverage may accelerate margin depletion;
ii) Requires strict position size control