Calculate In Advance to Make A Successful Trading, Meet the KuCoin Futures Calculator

2021/07/12 11:02:40

The benefits of futures trading are obvious. It allows traders to hedge existing spot positions and maximize returns by applying leverages to the limited investment assets. As long as the users can well-speculate on the future direction of the market, and use the right tools to minimize the risks, futures trading will be a great tactic in volatile markets.

Meanwhile, It is critical for a futures trader to understand and know exactly what the potential risk and reward will be in monetary terms on any of your futures tradings. This is the reason why KuCoin Futures introduced an easy-to-use tool to help traders to figure out their potential profits, liquidation price, and close price on a trade and to easily determine where to place a protective stop-loss/take-profit order, whether to open a long/short position and what leverages to set up to capture your expected profit.

This blog post will walk you through the instructions and tips below for how to use KuCoin Futures Calculator.

How to Use the KuCoin Futures Calculator?

Follow the three steps below to enter the futures calculator page.

Website version:

1. On the KuCoin Futures Pro page, go to “Trade ”;

2. Select your preferred contract type (USDT-Margined or COIN-Margined);

3. Click the calculator icon in the upper right corner of the “Place Order” section.

APP version:

Enter the "Futures" page and click the icon to find the "Calculator" as shown in the screenshot below.

You can now use KuCoin Futures Calculator to calculate potential Profits, Liquidation Price, and Close Price before placing any orders.

How to calculate the Profits?

Market participants trade in the futures market to make a profit or hedge against losses during market volatility. The KuCoin Futures calculator can help you determine and balance between the different parameters of long/short position, leverages, the entry price, close price, and contract size based on your expected profit.

Assuming a trader longs on the BTC Perpetual /USDT at an open price of 34,100 USDT and entered the close price at 36,000 USDT, with the size/amount of 1 BTC and 10x leverages. The calculator will show the corresponding costs and profits based on the entry. In this case, the trader will potentially get a profit of 1,900 USDT with an ROE of 55.72% based on the cost of 3,410 USDT. Users can try and alter each parameter to see the difference shown in the calculation result.

Now follow the steps to calculate your own profit:

1. Choose your position: Buy/Long or Sell/Short.

2. Select the leverage and input the entry price, close price, and size (amount).

3. Click ‘Start calculation’ to get the result of the Cost, Profits and ROE.

How to calculate the Liquidation Price?

Liquidation price is a key indicator for the futures trader to avoid a sizable loss before the margin call. However, many traders suffer from a total loss of margin when the position is forced to be liquidated, and it is complicated to do your own calculation without a tool. KuCoin Futures’s calculator can show you the potential liquidation price according to parameters of buy/long position, leverages, entry price and contract size pre-set by the trader, and you can easily manage your own risk by setting your close position well before the margin call. Let’s see what happens in the example below.

Assuming a trader opens a long position on the BTC Perpetual/USDT with an open price of 34,100 USDT, the contract size of 1 BTC, and 10x leverage. The corresponding result of Liquidation Price is shown as 30,860.50 USDT.

Now follow the steps to calculate your own liquidation price

1. Choose position direction: Buy/Long or Sell/Short.

2. Select the leverages and enter the entry price and contract size.

3. Click ‘Start calculation’ to get the result of the Liquidation Price.

Risk Tips：Selecting appropriate leverage is the key to manage position risks and reduce force liquidation possibilities. It is recommended for novices to set the leverage below 5x.

How to calculate the Close Price?

The Close Price would directly affect the ROE of a trading order opened by the Futures traders. Therefore, a reasonable close price will help the futures traders to reach their own profit targets when exiting the contract. The Futures calculator can calculate the close price based on your expected entry price, ROE, and leverages.

Assuming a trader Long on the BTC Perpetual/USDT with an open price of 34,100 USDT, expected ROE of 50% and 10x leverage. The corresponding data of Close Price=30,860.50 USDT will be obtained via the calculator.

Now follow the steps to calculate your own close price:

1. Choose position direction: Buy/Long or Sell/Short.

2. Select the leverage and input the Entry Price and ROE.

3. Click ‘Start calculation’ to get the result of your expected Close Price.

Risk Tips: The results from KuCoin Futures Calculator are for reference only. Deviations in the execution may occur due to the trading fees, funding fees, etc.