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This glossary explains the various terms related to derivative trading that are used throughout Demex.
The index price refers to the reference price for an underlying asset traded on Demex via perpetual or futures contracts. The price is based on various market data sources and reported by the Carbon blockchain's Oracles.
The mark price of a market refers to the price used as the fair value of a contract or position. This price is used to gauge when a position should be liquidated, and is also used to calculate estimated unrealized PnL on Demex.
The last price of a market refers to the the most execution price of the most recent trade for the market on Demex.
The settlement price refers to the settlement value of a dated futures contract at its expiry.
Funding rate is a mechanism to keep the price of perpetual contracts as close to the index price as possible.
When the funding rate is negative, short positions pay long positions, and when the funding rate is positive, long positions pay short positions. This happens every 1 hour on Demex.
The funding amount refers to the payment amount exchanged between long and short positions in perpetual contracts.
Funding Amount = Position size * Funding Rate
There are no fees applied on the Funding Amount.
Wallet balance refers to the total amount of funds available in a user's wallet.
The unrealized profit and loss (uPnL) refers to the potential profit or loss on an open position that has not been realized through closing the position.
For long positions, this is:
[(1/Entry Price) - (1/Mark Price)] * Position Size
For short positions, this is:
[(1/Mark Price) - (1/Entry Price)] * Position Size
Position margin refers to the value of collateral that is backing an open position.
Order margin refers to the margin required to place an order.
Margin balance represents the funds in your wallet that are available for you to use when placing new orders.
Your margin balance is given by:
Wallet Balance - Position Margin - Order Margin
Liquidation fees refer to the fees imposed when a position is forcibly closed due to having insufficient maintenance margin. There are no liquidation fees on Demex.