Huobi Futures 101 | What is One-Way Mode for Holding Positions and How to Use it?
Huobi Futures launched a new feature last week: One-way mode for holding USDT-margined contracts. Now what is one-way mode, and how is it used? What’s the difference between Hedge mode and One-way mode?
Read below to learn more the answers to these questions and more!
Both hedge mode and One-way mode are methods for investors to hold their positions.
🔹Hedge Mode: Users can hold both long and short positions for an asset at the same time under this mode. The long and short positions of an asset will hedge against each other.
🔹One-way Mode: Users can only hold positions in one direction (long or short) for an asset.
Sarah purchased 10 conts of BTC/USDT swaps to open a long position under Hedge Mode; she then sold 20 conts of BTC/USDT swaps to open a short position. Therefore, she currently has two positions:
Position 1: Long -10 conts
Position 2: Short -20 conts
If One-way mode is selected, you can decide whether to enable the “Reduce-Only” function when doing an opposite operation. If the function is enabled, the system will only decrease the existing positions of an asset; if it is not enabled, the system will help open an opposite position when the existing positions of the asset are not enough to decrease.
🔹Here are some examples to explain how to use this feature:
1) Reduce-Only function disabled
Sarah purchased 10 conts of BTC/USDT swaps to open a long position under the One-way mode, without enabling the Reduce-Only function. Then, she sold 20 conts of BTC/USDT swaps. At this time, the system helped her close the long position (10 conts) and open a short position of BTC/USDT swaps (10 conts). Now, she holds one position:
Position 1: Short -10 conts
2) Reduce-Only function enabled
Sarah purchased 10 conts of BTC/USDT swaps to open a long position under the one-way mode and enabled the Reduce-Only function. Then, she sold 10 conts of BTC/USDT swaps. At this time, the system helped her close the long position (10 conts) of BTC/USDT swaps. Now, she holds no BTC/USDT swaps positions.
You’ve now learnt how to use One-way mode. Now get on Huobi Futures to try both Hedge mode and One-way mode to decide how they fit into your trading style.
That about wraps up this quick overview of this NEW feature, follow us on our Huobi social channels to learn more about crypto and all things Huobi!