We have recently received numerous inbound requests from our users asking for further clarification on the related rules and operating mechanism regarding the maximum allowable order price deviation imposed on OKEx-listed futures.
Why has OKEX imposed such restrictions on order price?
The core rationale behind of imposition of a maximum order price deviation for OKEx futures is to protect legitimate investors interests from market manipulation and other intentional abuses.
In the absence of such a limitation, a handful of malicious traders could deploy a relatively small amount of capital with high leverage in order to trigger large price fluctuations within a relatively short time interval. The maximum order price allowed in placing an order will be dynamically adjusted from time to time taking, in order to take into consideration real-time market volume, volatility, gross/net open positions, and other risk parameters determined by OKEx.
What is the OKEx contract pricing limit rule?
Under normal circumstances, the maximum price at which a new contract may be opened is set at plus/minus 20% of the market price of the underlying index. The limit will be dynamically adjusted downward (ie. less than 20%) when OKEX’s market surveillance system takes into account the current market condition. Please note that unwinding holding positions will NOT be bound by this limitation (maximum order price deviation). Other trading rules however will still prevail.
The following case study illustrates this situation. The latest BTC/USD index 2448.65.
The highest price for open long ≤ 2448.65 * 120%
The lowest price for open short ≥ 2448.65 * 80%
What is the BTC Dollar Index?
The BTC dollar index is a price-equal-weighted index managed by OKEX which takes into account the last price as quoted by the six largest BTC exchanges globally. The index price is calculated in accordance with all of the exchanges’ current exchange rate, converted to US dollars. The BTC dollar index is quoted in points, where 1 point equals $1.
The LTC US dollar index released by OKEX is based on the weighted-average of the world’s largest five LTC exchanges, which reflect the LTC’s global market price changes. The index price is calculated in accordance with all the exchanges’ current exchange rate converted to US dollars. The LTC dollar index is quoted in points, where 1 point equals $1.
To learn more about the index, its calculation rules and methods, exchange rate adjustment rules for index calculation, etc., please log in to our official website at http://www.okex.com, to see more information at the trading center.
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