We are excited to announce the expansion of POL trading options, providing users with more flexible ways to engage with this digital asset. Starting at 8:00 am UTC on September 24, 2024, spot margin trading and Simple Earn products for POL will be available. Additionally, at 8:30 am UTC on the same day, POL USDT-margined perpetual futures will be enabled.
These updates are accessible across all platforms: web, mobile app, and API. Below, we break down the key features and mechanics of each new offering.
Margin Trading and Simple Earn Features
POL can now be traded with leverage through the spot margin market, and it can also be used to generate yield.
- Spot Margin Trading: The POL/USDT trading pair has been activated for margin trading. This allows traders to borrow funds to amplify their trading positions.
- Tiered Margin Levels: Specific tiers and requirements for margin levels will be detailed on our official platform following the listing. These tiers help manage risk by determining the amount of leverage available based on the size of a position.
- Simple Earn: Users can subscribe to flexible or fixed-term Simple Earn products using POL to earn potential rewards. The specific subscription limits and rates for POL will be published on our official site after the launch.
Understanding POL Perpetual Futures Trading
For traders interested in derivatives, POL USDT-margined perpetual futures offer a powerful tool. These contracts allow you to speculate on the future price of POL without an expiry date.
Key Specifications for POLUSDT Perpetual Futures:
- Underlying Asset: POL/USDT index
- Settlement Currency: USDT
- Contract Face Value: 10 POL per contract
- Price Quotation: USDT equivalent for 1 POL
- Minimum Price Movement (Tick Size): 0.0001
- Available Leverage: Ranges from 0.01x to 50x
- Trading Schedule: 24 hours a day, 7 days a week
Funding Fee Mechanism
A unique aspect of perpetual futures is the funding fee, which is periodically exchanged between long and short traders to tether the contract price to the spot index.
The funding rate is calculated as:Clamp(MA([(Best bid + Best offer) / 2 – Spot index price] / Spot index price – Interest), -0.75%, 0.75%), with Interest = 0.
To ensure stability for a new listing, a special measure is in place:
- Before 4:00 pm UTC on Sept 24, 2024: The funding fee upper limit is capped at 0.03%.
- After 4:00 pm UTC on Sept 24, 2024: The predicted funding fee cap returns to the standard 1.50%.
The first funding fee under the normal cap will be charged at 12:00 am UTC on September 25, 2024.
Price limit rules for this new contract align with those for other perpetual futures on the platform. For a comprehensive guide on how these limits work and other advanced details, you can explore our perpetual futures trading guides.
Strategies for Trading POL Derivatives
Engaging with new financial instruments requires a clear strategy. Whether you are a seasoned derivatives trader or new to perpetual futures, understanding your approach is key.
For margin trading, consider your risk tolerance and use leverage cautiously to avoid amplified losses. Simple Earn products are generally better suited for a long-term, lower-risk strategy aimed at accumulating assets over time.
Perpetual futures are advanced tools. Successful traders often keep a close eye on funding rates, as these can significantly impact the cost of holding a position, especially in volatile markets. Utilizing risk management features like stop-loss orders is highly recommended. To get advanced methods for managing a derivatives portfolio, consult our educational resources.
Frequently Asked Questions
What is the difference between margin trading and perpetual futures?
Margin trading allows you to borrow funds to trade spot assets, meaning you directly own the POL you purchase. Perpetual futures are derivative contracts that derive their value from POL's price, allowing for leverage without owning the underlying asset, and they have no expiry date.
How are the funding fees for POL perpetual futures calculated?
The funding fee is designed to balance the market. It is calculated based on the difference between the perpetual contract's mark price and the underlying spot index price. The rate is periodically applied to bring the two prices in line, with payments made between long and short position holders.
What is the maximum leverage I can use for POL perpetual futures?
The POLUSDT perpetual contract supports leverage of up to 50x. However, higher leverage dramatically increases both potential profits and potential losses, so it should be used with extreme caution and proper risk management.
When will the details for POL Simple Earn be available?
The specific details, including annual percentage yield (APY) and subscription limits for POL Simple Earn products, will be published on our official website immediately following the launch on September 24, 2024.
Can I trade these new POL products on my mobile phone?
Yes, absolutely. All newly launched POL trading features, including margin trading, Simple Earn, and perpetual futures, are fully accessible and functional on both the OKX mobile app and the web platform.
Are there any special risks associated with new perpetual contracts?
Yes, newly listed perpetual contracts can experience higher price volatility and less liquidity initially. The premium can be unstable, which is why a temporary funding fee cap is implemented to protect users from unreasonable charges in the first few hours.