Understand what UNI futures are and how to use the leverage in futures to amplify your trading gains
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UNI Contracts Listed on Delta Exchange
Uniswap futures enable you to take long (you profit when market goes up) and short positions (you profit when market goes down) on UNI. Futures have in-built leverage which acts as a multiplier to your returns. Currently, the following Uniswap contracts are listed on Delta Exchange.
Uniswap Perpetual100x
UNI Futures Contract Details
| Contract Name | UNIUSDT |
|---|---|
| Description | Uniswap Perpetual |
| Max. Leverage | 100x |
| Margin Currency | USDT |
| Taker Fees | 0.06% |
| Maker Fees | 0.04% |
| Contract Type | perpetual futures |
What is Uniswap Futures Trading?
Uniswap Futures is an agreement between two parties to buy or sell Uniswap at a predetermined future date and price. The futures contract derives its value from the underlying cryptocurrency, Uniswap in this case. Thus the price of a Uniswap futures contract moves broadly in sync with the price of Uniswap.
Trading futures is thus an alternative to actually buying or selling the underlying crypto (aka spot trading). In spot trading, you can make profit by buying Uniswap low and selling it at a high price. This trade however works only in a bull market, i.e. when Uniswap price is going up. However, in a bear market, there is no trade possible in spot trading. Furthermore, leverage trading is not possible in spot trading.
Trading Uniswap through futures offers several advantages over spot trading of Uniswap, namely ability to both long or short and get access to leverage.
Trade profitably in all market conditions
You can profit from rising UNI price by going long Uniswap futures. And, when UNI price is falling, you can make profits by going short. This feature of futures trading enable you to navigate all types of market conditions profitably. Compare this with directly buying Uniswap. When price is falling, you can either sell your Uniswap or suffer losses. In spot trading, there is no way of profiting from falling prices.
Hedge Price Risk
If you are a HODLer, you can still use futures to mitigate price risk. Say, you hold UNI. You can mitigate the risks you face when Uniswap is falling by going short UNI futures. In this case, a short futures position acts as a downside protection by effectively locking the $ value of your portfolio without the need for selling your Uniswap. Judicious use of futures as hedge can make you a better and stronger HODLer.
Amplify trading gains with leverage
Leverage enables you to open positions that are bigger than your trading capital. If you can open a position that is 10 times bigger than your trading capital, then you have 10x leverage available to you. The maximum allowed leverage for futures listed on Delta Exchange is as high as 100x. There are two ways of thinking about leverage:
Leverage as capital efficiency driver: For opening a position of a given size, higher the leverage lower the trading capital required. The leverage in spot trading is always 1x, while it is 3-4x in margin trading. This means futures is 20 to 100 times more capital efficient than spot or margin trading.
Leverage as a returns amplifier: Because in a leverage trade position size is greater than the capital deployed, impact of prices moves gets magnified. The return on capital deployed is leverage times the price return. This means that you can amplify your trading gains the effective use of leverage.
If UNI increased from $0 to $0 your return would be equal to:
+
1.25
%
Without leverage
+
12.5
%
With 10x leverage
+
25
%
With 20x leverage
+
31.25
%
With 25x leverage
Benefits of Trading UNI Through Futures
Magnify returns through leverage
In-built leverage magnifies impact of UNI price moves on your return on capital.
Trading both rising & falling markets
Long when bullish. Short when bearish. Trade all market conditions profitably.
Trade more with less
Deploy the capital freed up by using leverage in other trading opportunities
Why Trade UNI Futures on Delta Exchange
1
Increase profitability
Low trading fees, tight spreads & deep order books of our UNI contracts increase profitability of your trades
2
Improve risk management
Set TP / SL with your order, Leverage advanced order types and instruments (Options, Interest Rate Swaps) to create hedging strategies
3
Identify better trades
Use professional charts & advanced analysis tools to quickly identify trading opportunities
Have a Question About Trading UNI Futures?
What is the difference between futures and perpetual contracts?
Futures contracts have a fixed expiry date. In contrast, perpetual contracts do not expire.
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