📈Leverage Trading

Cadence offers the ability to trade perpetuals for various crypto assets.

Opening a position

Cadence offers the ability to both "Long" and "Short" tokens on the platform.

Click on "Long" or "Short" depending on which side you would like to open a leverage position on.

  • Long position

    • Earns a profit if the token's price goes up.

    • Makes a loss if the token's price goes down.

  • Short position

    • Earns a profit if the token's price goes down.

    • Makes a loss if the token's price goes up.

After selecting your side, key in the amount you want to pay and the leverage you want to use, in the below example 0.1 ETH worth 352.33 USD is being used to buy a 5x ETH (Ethereum) long position of size 1752.89 USD

The "Entry Price" is $3541.17 and the Liquidation Price is $2903.76. Below the swap box you would also see the "Exit Price", which is the price that would be used to calculate profits if you open and then immediately close a position. The exit price will change with the price of the token you are longing or shorting.

The trading fee to open a position is 0.1% of the position size, similarly, there is a 0.1% fee when closing the position.

There is also a "Borrow Fee" that is deducted at the start of every hour. This is the fee paid to the counterparty of your trade. The fee per hour will vary based on utilization, it is calculated as (assets borrowed) / (total assets in pool) * 0.01%. The "Borrow Fee" for longing or shorting is shown below the swap box.

While there are no price impacts for trades, there can be slippage due to price movements between when your trade transaction is submitted and when it is confirmed on the blockchain. Slippage is the difference between the expected price of the trade and the execution price, this can be customized by clicking on the "..." icon next to your address at the top right of the page.

Managing Positions

After opening a trade, you would be able to view it under your Positions list, you can also click on "Edit" to deposit or withdraw collateral, this allows you to manage your leverage and liquidation price.

When you open a position or deposit collateral, a snapshot of the USD price of your collateral is taken, so e.g. if your collateral is 0.1 ETH and the price of ETH is 3523.30 at the time, then your collateral is 352.33 USD and will not change even if the price of ETH changes.

The amount of profit and loss you make will be proportional to your position size. In this example, 352.33 USD has been used to buy 1752.89 USD of ETH. If the price of ETH increases by 10%, the position would have a profit of 175.29 USD, if the price of ETH decreases by 10%, the position would have a loss of 175.29 USD.

If a short position was opened instead, then if the price of ETH decreased by 10% the position would have a profit of 175.29 USD, if the price of ETH increased by 10%, the position would have a loss of 175.29 USD.

Leverage for a position is displayed as (position size) / (position collateral). If you'd like to display the leverage as (position size + PnL) / (position collateral), you can customize this by clicking on the "..." button next to your address.

Note that when depositing collateral into a long position, there is a 0.3% deposit fee for the conversion of the asset to its USD value, e.g. ETH amount to USD value. This is to prevent deposits from being used as a zero-fee swap. This does not apply to shorts. Withdrawing of collateral from longs and shorts does not have this fee.

Closing a Position

You can close a position partially or completely by clicking on the "Close" button.

For long positions, profits are paid in the asset you are longing, e.g. if you long CANTO you would get your profits as CANTO.

For short positions, profits will be paid out in the same stablecoin that you used to open the position, e.g. NOTE

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