What advantages does a perpetual futures contract offer over a quarterly futures contract in the realm of digital assets?

3 answers

• NSUNGWA EDINANCEAug 22, 2022 · 3 years ago
  A perpetual futures contract offers several advantages over a quarterly futures contract in the realm of digital assets. Firstly, a perpetual contract has no expiration date, allowing traders to hold positions for as long as they want without worrying about contract rollover. This provides more flexibility and eliminates the need to constantly monitor and manage contract expirations. Additionally, perpetual contracts often have higher liquidity compared to quarterly contracts, making it easier for traders to enter and exit positions. The absence of an expiration date also means that perpetual contracts can closely track the spot price of the underlying asset, reducing the impact of basis risk. Overall, perpetual futures contracts offer greater convenience, flexibility, and liquidity for traders in the digital asset market.
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• Nan MargaryanMay 12, 2024 · a year ago
  When it comes to digital assets, perpetual futures contracts have a clear advantage over quarterly futures contracts. The lack of an expiration date in perpetual contracts allows traders to hold positions indefinitely, which is particularly beneficial in volatile markets. With quarterly contracts, traders need to constantly roll over their positions, which can be time-consuming and may result in additional costs. Perpetual contracts also tend to have higher trading volumes and tighter spreads, making them more attractive for active traders. Additionally, perpetual contracts often have funding rates that help keep the contract price in line with the spot price, reducing the risk of basis divergence. Overall, perpetual futures contracts offer greater flexibility, cost-effectiveness, and market efficiency in the realm of digital assets.
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• Nguyên Lê NgọcMar 19, 2025 · 3 months ago
  In the realm of digital assets, perpetual futures contracts offer several advantages over quarterly futures contracts. Firstly, perpetual contracts do not have an expiration date, allowing traders to hold positions for as long as they want. This eliminates the need for contract rollover and reduces the associated costs and risks. Secondly, perpetual contracts often have higher liquidity compared to quarterly contracts, making it easier for traders to enter and exit positions at their desired prices. Additionally, perpetual contracts are designed to closely track the spot price of the underlying asset, reducing the impact of basis risk. This makes them more suitable for hedging and speculative trading strategies. Overall, perpetual futures contracts provide greater flexibility, liquidity, and risk management capabilities in the digital asset market.
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