How to trade Futures on @FTX_Official (not financial advice, obvs)
1/n

I only learned about futures a year ago. There are dangers to be aware of, but they& #39;re a great way to leverage your capital and multiply your earning potential.

I& #39;mma run you through "buying" some...
2/n

I& #39;ve got a few subaccounts on FTX. Highly recommend you do this, because each one is isolated. If you mess up and lose it all in one subaccount, the rest aren& #39;t impacted.

In this account I& #39;ve got some $ETH and some USD.
You will need something there as collateral.
3/n

In Settings, then Margin, you can see what is accepted as collateral. My understanding is that the USD in my subaccount is a stablecoin, not FIAT. So it counts, along with the $ETH. Someone correct me if I& #39;m wrong pls.

You might want your collateral to be non-volatile...
4/n

Search for $ETH-PERP(etual) Futures. This one here.

Once selected, you& #39;ll see it looks the same as if you were buying ETH-USD, except for some extra details on the right. You& #39;ll wanna pay particular attention to the two %s that the arrow is pointing to.
5/n

I& #39;m about to "buy" some now. It& #39;s not actually buying though, like with Spot.

With futures, we say we open a position. I am essentially buying, hoping price goes up, so I am opening a Long position.

I selected Market Order to just buy right now at the best price.
6/n

Done. Now I have a Long Position open.

See the Margin Fraction? The larger my positions, the smaller this number gets. If it ever gets down to the Maintenance Margin Requirement (3%) then my position will be automatically closed and my collateral will be sold to cover it.
7/n

That& #39;s the risk.
To open this position, I& #39;ve essentially borrowed ~$250 worth of someone else& #39;s $ETH. Someone on FTX lent it to me.
If the price of ETH goes up, then my position will be worth more than $250. I could then Close it, and pocket the difference/profit.
8/n

I changed the chart to 15min for clarity.
See my Long position? That& #39;s where I bought it, so that& #39;s the breakeven price. If, once I open it, the price goes down, I could choose to buy more. That would make my position larger, and bring the breakeven price down a bit.
9/n

Scroll down to see your open positions at the bottom of the page. Price has moved up since I opened the Long, so I am 35c in profit right now. But that is just a number on the screen until I choose to close it. I could press Market Close now and be done with it.
10/n

Back in Wallet, if you click Positions, you can see it here too. Since taking the previous screenshot, price has now gone down ( #Crypto amirite). So my position is 88c in the red.

See Funding Payments down the bottom?
11/n

This is what it costs to have a position open. Each hour, a funding payment occurs. You might have to pay, or you might get paid. It depends on what the majority of people are doing. If the majority wants to long $ETH, the people lending it out essentially charge a premium.
12/n

Now some time has passed. The position is in profit again (lol), and a payment has occurred. The number is positive, so I paid people who have Shorts open... I believe. Someone correct me if I& #39;m wrong. I know I paid, just not sure exactly who gets the money.
13/n

https://www.viewbase.com/funding ">https://www.viewbase.com/funding&q... shows the current Funding Rates across a bunch of exchanges. You can see $ETH on @FTX_Official here is slightly green. These boxes can be clear, green or red. The more green, the more people are going Long. It& #39;s a good sentiment check.
14/n

This was from a few days ago. The funding rates were high across the board. Check out $DOGE. This was in the lead up to Elon& #39;s SNL appearance.

Traders were leveraged Long here, so the opportunity for a big dump and a reset were likely. And that did end up playing out.
15/n

Now I& #39;m going to close my position. I selected Market Order, and pressed Close Position.
The most important thing to know here is to click Reduce Only. I hovered over it, so this little info box appeared.
Now I press Sell.
16/n

Remember, my position used borrowed funds. I opened a Long, but I could have opened a Short if I thought price was going to go down.

If you don& #39;t press Reduce Only, you might Close more than you have open. So FTX would open a new Short with whatever the difference is.
17/n

So that& #39;s how you open and close a Futures position. I made a cool $2, and paid 1.7c for Funding, with assets that were sitting there.

Now read on for some risks, and some ways to optimise your futures trading...
18/n

Risk: If you have a position open for ages and it isn& #39;t going up, you could pay more for Funding than you earn as profit.

Risk: If your position goes too far in the red, you can be Margin Called. Your position is closed and your collateral sold, to cover the loss.
19/n

You can set Stop Losses and Trailing Stops, etc, like with Spot trading. Remember, that profit isn& #39;t locked in until you close the position. Protect the position against sudden drops so that you can lock in that profit.
20/n

You can also use leverage. This is super risky. With leverage, you could open a position that is larger than the amount of collateral you actually have. Got $500 sitting there? You could open a $5000 long with 10x leverage. If you did that, the 315% might be more like 10%
21/n

Clearly, it wouldn& #39;t take too big a move for your position to be $500 in the red- so you& #39;d be margin called and lose it all.

IF you& #39;re CERTAIN price is moving up for the next few minutes, you could open that leveraged long. When price moves up a tiny bit, close 5% of it.
22/n

Keep closing little %s as it keeps moving up (don& #39;t forget to press Reduce Only- make it a habit).

This will move your average buy in price lower (your breakeven number).

It will increase the Margin Fraction too.

Keep going until the position is a safe size.
23/n

FYI, until you close your position, the profit or loss will be reflected in your USD balance. If there& #39;s profit, you can spend it (eg. on more Spot) before closing the position. This is compounding your gains, but is risky cos you& #39;re spending money you haven& #39;t secured yet.
24/24

If you spend that USD without closing the position, and then the position goes red, your USD balance will be negative.

You& #39;ll have to sell underlying Spot tokens to bring the balance back above 0.

That& #39;s it!

Good luck and happy #trading
Oh yeah, and if you sign up to @FTX_Official with my referral code, you get 5% off transaction fees.

See how you go with futures trading!

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