Trading Fees and Rebates
Open / Close Fees
The basic trading fee to open a position is 0.04% or 0.06% of the position size, similarly there is a 0.04% or 0.06% fee when closing the position. This applies for increasing the position size of an existing position and partially decreasing a position size as well. If the trade increases the balance of longs and shorts then the fee would be 0.04%, otherwise the fee would be 0.06%.
It is worth noting that due to the discounts provided by the Referrals and VIP mechanisms, as well as GT being offered as trading rewards, the actual trading costs for traders will be significantly low.
Swap Fees
The fees for a normal swap are 0.05% or 0.07% of the swap amount. If the trade increases the balance of tokens in the pool then the fee would be 0.05%, otherwise the fee would be 0.07%.
Price Impact
There may be a positive or negative price impact for increasing / decreasing positions and for swaps.
If the trade improves the long / short balance or tokens in the pool then there would be a positive price impact, otherwise there would be a negative price impact.
For increasing / decreasing positions, a positive price impact would result in an entry / exit price that is more favourable for your position, e.g. if opening a long position with a positive price impact, the position's entry price would be lower. A negative price impact would result in a entry / exit price that is less favourable, e.g. if opening a long position with a negative price impact, the position's entry price would be higher.
For swaps, a positive price impact would increase the amount of tokens received while a negative price impact would decrease the amount of tokens received.
The price impact values can be viewed on the interface when making a trade.
Price Impact Rebates
Under normal circumstances, the long and short open interest should be mostly equal and price impact should be minimal.
However, it is possible in times of volatility for the long and short open interest to be imbalanced leading to a high price impact.
Price impact rebates help to reduce the effect of this. Each market has a maximum price impact as a guideline; if a trade is closed with a price impact higher than this percentage then the additional impact would become claimable after approximately 10 days.
For example, if the maximum price impact for a market is 1% and a trade is closed with 3% negative price impact, then the collateral equivalent to 2% negative price impact would be claimable after a few days on the interface.
The purpose of having a delay of a few days is to guard against price manipulation attempts. In the case of a price manipulation attempt, rebates should be reviewed and only applied to accounts that were not involved in the price manipulation.
Note that this rebate only applies to closing / decreasing of positions; for opening / increasing of positions there is no maximum price impact. For market increase orders, the price impact would be shown on the interface so that users can decide if the impact is acceptable. For limit orders the acceptable price including any price impact must be met for the order to be executed.
Funding Fees
There may be positive or negative funding fees while a position is open.
The funding fee rate can be viewed on the interface when making a trade. Note that the rate will change over time based on the balance of longs and shorts.
If you receive positive funding fees for your position, these fees can be claimed by using the "Claim" button in the "Claimable Funding" box of the Trade page.
Adaptive Funding
Funding rates gradually adjust over time based on the long and short ratio.
For example, if the total long open interest is larger than the short open interest then the funding rate that longs pay shorts will gradually increase until the difference between the long and short open interest is below a certain threshold or an upper limit is reached, at which time the funding rate will remain constant.
If in this scenario more shorts are opened or longs are closed such that there are now more shorts than longs then the funding rate that longs pay shorts will gradually decrease until the difference between the long and short open interest is below a certain threshold.
If there remains more shorts than longs then the funding rate will gradually adjust in the other direction such that shorts will pay longs a funding rate that gradually increases until the difference between the long and short open interest is below a certain threshold or an upper limit is reached.
Borrowing Fees
To avoid a scenario where liquidity is fully reserved by a user opening equal long and short positions for a small cost, there is a borrowing fee for open positions. If there are more longs than shorts then longs would pay the borrowing fee, if there are more shorts than longs then shorts would pay the borrowing fee. This borrowing fee also helps to incentivise more liquidity to be added in the event that all liquidity is reserved for positions.
The borrowing fee rate can be viewed on the interface when making a trade. Note that the rate will change over time based on the pool utilization percentage.