Hedge Mode — Open Long and Short Futures Positions at Once
We are excited to introduce Hedge Mode, a new feature for futures trading that enhances our users’ capabilities. With Hedge Mode, you can open both long and short positions on a single trading pair simultaneously, simplifying risk hedging and adding more flexibility to your strategies.
This update is designed for those who want to manage their positions more precisely and automate their trading, without the need for complex workarounds.
How Does the Hedge Mode Work?
Hedging is a strategy for minimizing the risks associated with unpredictable market fluctuations by opening positions in opposite directions. The primary goal of hedging is to protect capital and reduce potential losses if the market moves unfavorably.
The approach involves opening both long and short positions on the same asset, helping to mitigate the impact of sharp price fluctuations on overall performance. This strategy allows traders to preserve part of their capital during negative market movements, while still maintaining the opportunity to profit from positive trends.
Hedging Example on the BTC-PERP Pair with Hedge Mode
Let’s explore how Hedge Mode can be used for hedging on the BTC/PERP pair:
- Opening a long position: If you expect BTC’s price to rise in the short term, you open a long position on the BTC-PERP pair. This allows you to profit from the BTC price increase.
- Opening a short position: At the same time, if you anticipate the price may fall sharply or you wish to protect your profits, you can open a short position on the BTC-PERP pair. In this case, even if the price of BTC drops, your short position can help offset some losses from your long position.
By activating Hedge Mode, you can simultaneously hold these two positions in one market, i.e., open both a long and a short position at the same time, or first open, for example, a long position and then a short position on the same pair.
What Benefits Does Hedge Mode Provide to Users?
Hedge Mode offers several key advantages for traders:
- Effective Risk Management — Hedge open positions to minimize the impact of sudden market fluctuations.
- Increased Trading Flexibility — Hold positions in both directions simultaneously, unlocking new opportunities for complex strategies and higher profitability.
- Optimized Capital Utilization — Gain better control over investments, reducing potential losses. In volatile markets, combining long and short positions allows for quick responses, enhancing portfolio stability.
Hedge Mode is available to all users in regions where perpetual futures trading is supported on WhiteBIT.
How to Activate the New Mode?
To open positions in both directions on a single pair, you need to activate Hedge Mode. By default, One-way Mode is enabled. You can easily switch between modes using the following options:
- In the mobile app, you can select the mode by tapping on the “More” section in the selected PERP pair window. Then, go to: Settings → Futures Position Mode.
- In the web version, you can switch to Hedge Mode from the trading terminal’s information block or through the account settings under the “General” section.
- Via API: Hedge Mode is also accessible through an API endpoint for automated trading, enabling you to seamlessly integrate its functionality into your trading strategies and position management systems.
Please note that switching modes is only permitted when all open futures orders and positions have been fully closed. This ensures proper functionality and helps prevent trading errors. Find detailed instructions on activating the Hedge mode in the Help Center article.
How to Open and Close Positions in Hedge Mode
When Hedge Mode is enabled, the order creation form in the trading terminal will be updated, allowing you to clearly distinguish between different position actions. For example, in the center layout, you’ll see four buttons: Open (Long), Close (Long), Open (Short), and Close (Short). In alternative layouts, two key options will appear at the top of the form: Open and Close. Selecting either option changes the color coding of the order and its functionality, making the trading process more intuitive and minimizing the risk of errors.
The “Open” option provides two choices: open a new or increase an existing long position, or open a new or increase an existing short position.
The “Close” option allows you to fully or partially reduce a long position by decreasing its volume, or close or reduce a short position.
This approach simplifies position management, making it clear and accessible for both experienced traders and beginners.
You can easily view the details of all open and closed positions in the “History” section.
Activate Hedge Mode today and elevate your trading strategies to a professional level!
