What are the differences between perpetual futures and traditional futures on FTX?

5 answers

• Tushar MeenaDec 16, 2021 · 4 years ago
  Perpetual futures and traditional futures on FTX have several differences. Firstly, perpetual futures do not have an expiration date, while traditional futures have a fixed expiration date. This means that perpetual futures can be held indefinitely without the need to roll over or close positions. Secondly, perpetual futures use a funding mechanism to maintain their price close to the spot market. Funding rates are periodically exchanged between long and short positions to achieve this. On the other hand, traditional futures are settled at the expiration date based on the difference between the contract price and the spot price. Lastly, perpetual futures on FTX offer higher leverage compared to traditional futures, making them more suitable for short-term trading. Traditional futures, on the other hand, are better for long-term positions as they allow traders to hedge against price fluctuations over a longer period of time.
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• Sandro CristianoNov 20, 2021 · 4 years ago
  The main difference between perpetual futures and traditional futures on FTX lies in their expiration and funding mechanisms. Perpetual futures do not have an expiration date, which means that traders can hold their positions for as long as they want without worrying about contract rollover. On the other hand, traditional futures have a fixed expiration date, which requires traders to either close their positions or roll them over to the next contract before the expiration. In terms of funding, perpetual futures use a funding rate mechanism to keep their price in line with the spot market. This funding rate is exchanged between long and short positions every 8 hours. Traditional futures, on the other hand, are settled at the expiration date based on the difference between the contract price and the spot price. Overall, perpetual futures offer more flexibility for traders who want to hold their positions for an extended period of time, while traditional futures are better suited for shorter-term trading strategies.
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• Jhon1990Jul 17, 2024 · a year ago
  Perpetual futures and traditional futures on FTX have distinct differences in terms of expiration and funding. Perpetual futures do not have an expiration date, allowing traders to hold their positions indefinitely. This eliminates the need for contract rollover and provides more flexibility for long-term trading strategies. In contrast, traditional futures have a fixed expiration date, which requires traders to manage their positions before the contract expires. Additionally, perpetual futures use a funding mechanism to maintain their price close to the spot market. Funding rates are exchanged between long and short positions every 8 hours. Traditional futures, on the other hand, are settled at the expiration date based on the difference between the contract price and the spot price. When it comes to short-term trading, perpetual futures on FTX offer higher leverage compared to traditional futures, making them more suitable for traders looking for amplified returns.
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• Beluga BaekJul 08, 2021 · 4 years ago
  Perpetual futures and traditional futures on FTX differ in terms of expiration and funding mechanisms. Perpetual futures do not have an expiration date, allowing traders to hold their positions for as long as they want. This provides more flexibility for long-term trading strategies and eliminates the need for contract rollover. On the other hand, traditional futures have a fixed expiration date, which requires traders to manage their positions before the contract expires. In terms of funding, perpetual futures use a funding rate mechanism to maintain their price close to the spot market. This funding rate is exchanged between long and short positions every 8 hours. Traditional futures, on the other hand, are settled at the expiration date based on the difference between the contract price and the spot price. When it comes to short-term trading, perpetual futures on FTX offer higher leverage compared to traditional futures, making them more suitable for traders looking for amplified returns.
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• Tyler FreemanSep 29, 2023 · 2 years ago
  Perpetual futures and traditional futures on FTX have different characteristics. Perpetual futures do not have an expiration date, which means that traders can hold their positions for as long as they want without worrying about contract rollover. On the other hand, traditional futures have a fixed expiration date, which requires traders to either close their positions or roll them over to the next contract before the expiration. In terms of funding, perpetual futures use a funding rate mechanism to maintain their price close to the spot market. This funding rate is exchanged between long and short positions every 8 hours. Traditional futures, on the other hand, are settled at the expiration date based on the difference between the contract price and the spot price. When it comes to trading strategies, perpetual futures are more suitable for short-term trading due to their higher leverage, while traditional futures are better for long-term positions as they allow traders to hedge against price fluctuations over a longer period of time.
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