Why Does the Position Margin of a Perpetual Contract Decrease Without Reducing the Position?

Why Does My Position Margin Fluctuate?

Many users of perpetual contracts encounter confusion about why their position margin fluctuates—either decreasing or increasing—even when they haven’t reduced their position. This is primarily due to the funding fee mechanism and the fluctuations in market prices.

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Funding Fee Mechanism

EasiCoin perpetual contracts utilize a funding fee mechanism to keep the perpetual contract market price in line with the spot price.

The funding fee is charged every 8 hours at the following times (HKT):

• 08:00

• 16:00

• 24:00

Users will only need to pay or receive the funding fee if they hold a position at these times. If the position is closed before the fee is charged, the user will not need to pay the funding fee.

Funding Fee Formula: Funding Fee = Position Value * Current Funding Rate

• When the funding rate is positive: Long positions pay short positions.

• When the funding rate is negative: Short positions pay long positions.

This means that users holding perpetual contract positions may either be charged a funding fee or receive one. The actual funding fee a user receives depends on the total amount deducted from the counterparty’s account by the system.

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In Cross Margin Mode

Position Margin Formula: Position Margin = Contract Value * Number of Contracts * Latest Mark Price / Leverage.

Since position margin depends on the market price and the number of contracts, it will fluctuate as prices move. The funding fee will also have a minor effect on the margin.

Note: EasiCoin does not charge any funding fees; the funding fees are collected between users.

EasiCoin Team