What are the differences between Binance futures quarterly and perpetual contracts?

5 answers

• Dec 26, 2021 · 3 years ago
  Binance futures quarterly contracts and perpetual contracts are two popular types of derivative contracts offered by Binance. Quarterly contracts have a fixed expiration date, usually every three months, while perpetual contracts do not have an expiration date. This means that perpetual contracts can be held indefinitely, while quarterly contracts require traders to close their positions before the expiration date. Perpetual contracts also have a funding mechanism to ensure the contract price closely tracks the underlying asset price. Quarterly contracts, on the other hand, settle at a predetermined price on the expiration date. Traders often choose quarterly contracts for longer-term positions and use perpetual contracts for shorter-term trades.
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• Dec 26, 2021 · 3 years ago
  When it comes to advantages, perpetual contracts offer continuous trading opportunities without the need to worry about contract expiration. Traders can hold their positions for as long as they want, which provides flexibility in implementing trading strategies. On the other hand, quarterly contracts can be useful for traders who want to align their positions with specific events or market cycles. Quarterly contracts also have fixed settlement dates, which can be beneficial for risk management and planning. However, traders need to be aware of the potential impact of expiration dates on their positions and adjust their strategies accordingly.
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• Dec 26, 2021 · 3 years ago
  BYDFi, a digital asset exchange, offers perpetual contracts for trading. Perpetual contracts provide traders with the ability to trade with leverage, allowing them to amplify their potential profits or losses. Traders can choose the desired leverage level based on their risk appetite and trading strategy. However, it's important to note that trading with leverage also increases the risk of liquidation if the market moves against the trader's position. Traders should carefully manage their risk and use appropriate risk management tools, such as stop-loss orders, to protect their capital.
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• Dec 26, 2021 · 3 years ago
  In terms of trading strategies, traders can use quarterly contracts to take advantage of longer-term trends and market cycles. They can also use quarterly contracts to hedge their positions in the spot market. Perpetual contracts, on the other hand, are more suitable for short-term trading and scalping strategies. Traders can take advantage of price fluctuations and trade in and out of positions more frequently. It's important to consider the funding rate in perpetual contracts, which is used to maintain the contract price close to the underlying asset price. Traders should be aware of the funding rate and its impact on their trading costs.
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• Dec 26, 2021 · 3 years ago
  When it comes to risk management, traders should carefully consider their risk tolerance and adjust their position size and leverage accordingly. It's important to set stop-loss orders to limit potential losses and use proper risk management techniques. Traders should also stay updated with market news and events that can impact the cryptocurrency market. By staying informed and having a solid risk management plan, traders can navigate the differences between Binance futures quarterly and perpetual contracts effectively.
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