Compared with futures contracts, perpetual contracts have no expiration date or settlement date, which is more like the spot market of margin. Therefore, its trading price is close to the price of the basic reference index.
Because perpetual contracts have no delivery date, they are more suitable for long-term positions. In other words, as long as the user opens the position, as long as there is no explosion, the position will be closed forcibly, and the position will never be closed passively. As long as your order is not voluntarily withdrawn, it will be kept permanently until the transaction is concluded.
There is no delivery date, which means that there is no mandatory constraint on the price of perpetual contracts and it will become a gambling tool. In order to avoid this situation.
A permanent contract has the following terms:
1. At a certain moment, when the futures price is greater than and obviously deviates from the spot price, the bulls need to pay the short seller.
2. At a certain moment, when the futures price is less than and obviously deviates from the spot price, the empty party needs to pay multiple parties.
3. The greater the deviation, the higher the payment rate.
Perpetual contract: it is an innovative financial derivative, which is developed on the basis of delivery contract, but it is still very different from before. Perpetual contracts are similar to the secured asset market, and their prices are close to the target reference index prices, and there is no concept of due delivery date. As long as the contract doesn't explode, you can keep it.
Permanent contracts are divided into forward contracts and reverse contracts:
U-standard contract, a contract whose profit and loss are calculated by USDT. Transfer USDT to contract account to establish position and calculate profit and loss.
Reverse contracts (currency-based contracts) are contracts that calculate profits and losses based on digital assets such as BTC and ETH. For example, in a BTC reverse contract, the user transfers the BTC to a contract account to open a position, and after closing the position, he makes a profit or stops the loss in the form of BTC.
The capital ratio is positive, and the perpetual contract price is higher than the marked price. Therefore, many parties should pay the capital cost to the empty side;
The capital rate is negative, and the perpetual contract price is lower than the marked price. Therefore, the empty side has to pay the capital cost to many parties.
Capital ratio refers to the difference between market price and spot price based on permanent contract. It can prevent the prices of the two markets from deviating continuously, and it will be recalculated many times in one day, and some contract trading platforms will calculate it every eight hours.
The capital ratio consists of two parts: interest rate and premium coefficient. The interest rate is designed to ensure that the transaction price of the permanent swap contract closely follows the spot price.