1. Cross Margin Mode Explained
In cross margin mode, each user maintains a dedicated "Futures Account" that serves as collateral for USDT-denominated futures trading. Key features:
- Separate accounts for each USDT futures contract by currency
- Funds can be transferred between different currency accounts
- Seamless transfers between Futures Account and Spot/Margin/Fiat accounts
Transfer Rules:
Before contract settlement, only excess equity above margin requirements can be transferred out. Example: With 10 USDT equity and 2 USDT margin, 8 USDT is transferable.
Futures Account Structure
| Component | Description |
|---|---|
| Account Equity | Total net assets = Account Balance + Realized P&L + Unrealized P&L |
| Account Balance | Collateral deposited from other accounts (spot/fiat/funding) |
| Realized P&L | Profits/losses from closed positions since last settlement |
| Unrealized P&L | Floating profits/losses from open positions |
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Risk Management Metrics
| Metric | Calculation | Purpose |
|---|---|---|
| Margin Ratio | (Equity)/(Position Value + Frozen Margin*Leverage) | Risk indicator |
| Maintenance Margin | Minimum margin to maintain positions | Triggers liquidation when breached |
2. Isolated Margin Mode Deep Dive
In isolated margin mode, users operate through:
- Primary "Futures Account" (base collateral)
- Dedicated "Sub-Accounts" per position
Key Differences from Cross Margin:
- Sub-account funds cannot be transferred until position closure
- Fixed margin remains constant unless manually adjusted
- Stronger position isolation prevents cross-position liquidation
Sub-Account Components
| Element | Function |
|---|---|
| Sub-Account Balance | Position-specific collateral |
| Frozen Margin | Reserved for pending orders |
| Fixed Margin | Locked collateral for open positions |
Margin Calculation Example:
Available Margin = Account Balance + Sub-Account Balance + Realized P&L - Used Margin3. Profit & Loss Calculations
Realized P&L Formulas
Long Positions: (Contract Size × Close Price - Contract Size × Settlement Price) × Closed Quantity
Short Positions: (Contract Size × Settlement Price - Contract Size × Close Price) × Closed Quantity
Unrealized P&L Formulas
Long Positions: (Contract Size × Mark Price - Contract Size × Settlement Price) × Open Quantity
Short Positions: (Contract Size × Settlement Price - Contract Size × Mark Price) × Open Quantity
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FAQ: Futures Trading on OKX
Q: Which margin mode is better for beginners?
A: Isolated margin is recommended for new traders as it limits risk to individual positions.
Q: How often does settlement occur?
A: Daily at 16:00 UTC+8, converting unrealized P&L to realized P&L.
Q: What happens during liquidation?
A: Positions are automatically closed when margin ratio ≤ maintenance rate + fees.
Q: Can I switch between margin modes?
A: Yes, but existing positions must be closed before switching modes.
Q: How is leverage applied in calculations?
A: Leverage affects margin requirements: Margin = (Position Value)/Leverage.
Q: Why use cross margin?
A: Best for hedging strategies as it pools collateral across positions.