Perpetual swaps FAQ
This FAQ explains how to access perpetual swaps on OKX Singapore, how they work, and what you should understand before opening a position.
Eligibility and access
Who can trade perpetual swaps on OKX Singapore?
Perpetual swap trading is available to:
Accredited Investors; and
Non-Accredited Investors who have successfully completed the derivatives suitability quiz.
Availability remains subject to your account status and other applicable eligibility requirements.
How do I complete the suitability quiz?
Log in to your OKX account and complete the derivatives suitability quiz.
The quiz helps assess whether derivatives trading is suitable for you. Complete it before attempting to access perpetual swap trading.
Understanding perpetual swaps
What’s a perpetual swap?
A perpetual swap is a type of crypto derivative that lets you trade based on whether you expect an asset’s price to rise or fall. You don’t need to own the underlying asset, and the contract doesn’t have an expiry date.
How are perpetual swaps different from traditional futures?
Traditional futures contracts expire on a specified date. Perpetual swaps don’t expire, so you can keep a position open as long as you meet the applicable margin requirements and pay or receive any funding fees.
You can close your position at any time, subject to market conditions.
Can I trade when I expect the market to fall?
Yes. You can:
Open a long position if you expect the asset’s price to rise.
Open a short position if you expect the asset’s price to fall.
Your position may generate a profit if the market moves in the direction you expected. You’ll incur a loss if it moves against your position.
What leverage can I use?
You may be able to use leverage of up to 50×, depending on the trading pair.
Leverage lets you control a larger position with a smaller amount of margin. For example, 1,000 USDT of margin at 10× leverage could open a position worth 10,000 USDT.
Higher leverage also increases your liquidation risk as a smaller adverse price movement can use up your available margin.
What are funding fees?
Funding fees are periodic payments between long and short position holders. They help keep the perpetual swap price aligned with the underlying spot market.
Depending on the applicable funding rate and your position, you'll either pay or receive a funding fee. Check the current and estimated funding rates in the trading interface in your account before opening or holding a position.
Margin and liquidation
What’s margin?
Margin is the collateral you use to open and maintain a leveraged position. You don’t need to provide the position’s full value upfront.
Only eligible assets in your trading account count toward your margin. Assets held in your funding or Earn account can’t support an open perpetual swap position.
What’s the difference between initial margin and maintenance margin?
Initial margin is the minimum collateral required to open a position. Using higher leverage lowers the initial margin requirement but gives the position less room to absorb adverse price movements.
Maintenance margin is the minimum collateral required to keep a position open.
You can monitor your maintenance margin ratio (MMR) in the trading interface.
When does liquidation happen?
Liquidation is triggered if your MMR falls to 100% or below. We may automatically close part or all of your position at the prevailing market price.
The final execution price may differ from the price shown before liquidation, especially during volatile market conditions. Liquidation can happen quickly, and there’s no grace period.
How much could I lose?
You can lose all the collateral allocated to derivatives trading in your trading account. Losses can occur rapidly when you use leverage or trade during volatile market conditions.
Consider your financial situation and risk tolerance before trading perpetual swaps.
Managing risk
How can I reduce my liquidation risk?
You can take the following steps:
Use lower leverage to maintain a larger margin buffer.
Choose a position size that matches your risk tolerance.
Set stop-loss orders before or immediately after opening a position.
Check your MMR regularly, especially when the market is volatile.
Add margin or reduce your position if your MMR approaches the liquidation threshold.
Note: Stop-loss orders and liquidation alerts can help you manage risk, but they don’t guarantee execution at a specific price or prevent losses during rapid market movements.
Are perpetual swaps regulated in Singapore?
Payment token derivatives and certain related services, including margin borrowing and structured products, are provided by OKX Financial and are unregulated. OKX Financial isn’t licensed in any jurisdiction.
Refer to the OKX Financial Terms of Service and OKX Financial Risk Disclosure before using these products.