About Fair Price Marking

BitMEX employs a uniquely designed Fair Price Marking system to avoid unnecessary liquidations on high leveraged products.

Without this system, the marked price could deviate unnecessarily from the price index due to market manipulation or illiquidity, leading to unnecessary liquidations.

This system sets the marked price to Fair Price Marking, thus avoiding unnecessary liquidations.

For a swap contract, the fair price is equal to the underlying index price plus a funding cost basis that decreases over time.

For futures contracts, the fair price is equal to the underlying index price plus the annualized fair basis, also known as Fair Price Marking.

All auto-reduction contracts use the fair price marking method.

Also, please note that this method only affects liquidation price and unrealized profit and loss, it does not affect realized profit and loss.

Note: This means that you may see a positive or negative unrealized profit or loss immediately after your order is executed. This happens because of the slight deviation between the fair price and the traded price. This is normal and does not mean you have lost your funds, but be sure to keep an eye on your liquidation price to avoid premature liquidation.

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