This content is for educational purposes only and does not constitute financial advice. Always do your own research before making any trading decisions.

Perpetual futures trading has become a cornerstone of crypto markets, and Surge brings this functionality fully on-chain to the Radix ecosystem. As Radix's first perpetual DEX, Surge enables traders to take leveraged long or short positions on major cryptocurrencies without owning the underlying assets. This tutorial will walk you through the mechanics of trading perpetuals, managing positions, and understanding the unique aspects of decentralized perpetual trading on Surge.

What Are Perpetual Futures?

Perpetual futures are derivatives that allow you to speculate on price movements without an expiration date. Unlike traditional futures that settle on a specific date, perpetuals can be held indefinitely as long as you maintain sufficient margin.

On Surge, all trading is based on oracle price feeds - you're not trading actual underlying assets but rather synthetic positions that track the price. The oracle provides reliable price data from multiple sources, and all position values, liquidations, and settlements are calculated using these oracle prices. This means you can gain exposure to BTC, ETH, or other assets without ever holding them.

The funding rate mechanism on Surge incentivizes balance between long and short positions. When there are more longs than shorts, longs pay funding to shorts (and vice versa), encouraging traders to take the less crowded side and helping maintain system stability.

Going Long means betting the price will rise - you profit when it goes up and lose when it falls. Going Short means betting the price will fall - you profit when it drops and lose when it rises. With leverage, these gains and losses are amplified: at 10x leverage, a 5% price move becomes a 50% gain or loss.

On Surge, you can trade major pairs against USD including BTC, ETH, SOL, XRD, SUI, DOGE, ADA, and BNB with up to 50x leverage. All positions are denominated in USD, simplifying calculations and P&L tracking

How Trading Works on Surge

The Cross-Margin System

In perpetual trading, margin is the collateral you deposit to secure your leveraged positions. Think of it as a security deposit that ensures you can cover potential losses. When you trade with 10x leverage on a $1,000 position, you only need $100 of margin, but you control the full $1,000 worth of exposure.

Surge uses a cross-margin model where all your collateral and positions share a single margin pool. This differs from isolated margin where each position has its own collateral. With cross-margin, profits from one position can offset losses in another, providing more flexibility but also sharing risk across all trades.

On Surge, cross-margin is the default and only mode - you don't need to enable it or choose between margin types. All your positions automatically share the same collateral pool. This means if you have a profitable BTC long and a losing ETH short, the BTC profits help maintain margin for the ETH position. However, it also means a large loss in one position can trigger liquidation across all your trades.

Your account balance consists of your deposited collateral plus or minus any unrealized P&L from open positions. This total equity determines your buying power and liquidation risk across all positions.

Supported Collateral

Surge accepts multiple collateral types, giving traders flexibility in funding their accounts:

• xUSDC 
• sUSD 
• xwBTC and hWBTC
• xETH and hETH 
• LSULP 
• XRD

‍

All collateral types contribute to your total margin. There are no minimum deposit amounts or position size requirements, allowing traders to start with any amount they're comfortable with.

Getting Started with Trading

Step 1: Connect and Create Your Trading Account

1. Navigate to surge.trade
2. Connect your Radix Wallet
3. Select your Persona
4. Create a new trading account - you can either:
   
   • Make an initial deposit during account creation
   • Create a blank account and deposit later
5. Sign the transaction to receive your recovery key NFT (keep this safe)
6. Once your account is created, click on "Deposit" or the bank icon to add collateral
7. Select your collateral type from the available options
8. Enter the amount to deposit
9. Confirm the transaction in your wallet

Your deposited collateral immediately becomes available for trading. The interface displays your account value, available margin, and current positions in the top right corner.

Step 2: Understanding the Trading Interface

The trading interface shows:

• Price Chart: Real-time price action for your selected pair
• Order Panel: Where you place market, limit, or stop orders
• Positions Tab: Your open positions with unrealized P&L
• Trade History: Recent trades and order executions
• Account Overview: Total equity, margin usage, and risk meter

The risk meter visually represents your margin utilization. Green indicates safe levels, while red warns of approaching liquidation. Keep this below 100% to avoid liquidation.

Step 3: Opening Your First Position

To open a position:

1. Select Your Pair: Choose from BTC, ETH, SOL, XRD, or other supported assets
2. Choose Direction: Click "Long" if you expect prices to rise, "Short" if you expect them to fall
3. Set Leverage: Start conservatively while learning. Options go up to 50x but higher leverage means higher risk
4. Enter Size: Input your position size in USD or the base asset
5. Review Fees: Check the 0.10% base fee plus any price impact
6. Place Order: Click "Buy/Long" or "Sell/Short" to execute

Your position appears immediately in the positions tab, showing entry price, current P&L, and funding payments.

Order Types and Execution

Market Orders

Market orders execute immediately at the current oracle price. They're simple and fast but may have price impact on larger trades. Use market orders when you need immediate execution and the 0.10% fee is acceptable for your strategy.

Limit Orders

Limit orders let you set a specific entry price. They only execute if the market reaches your price, avoiding slippage but risking non-execution. Limit orders require keepers to monitor and execute when conditions are met based on oracle price updates. There's no additional fee for limit orders beyond the standard trading fee.

Stop Limit Orders

Stop limit orders combine a trigger price with a limit price. When the market hits your stop price, a limit order is placed. This helps manage risk by setting predefined exit points or entry levels for momentum trades. Like regular limits, these rely on keeper execution.

Reduce Only and TP/SL

The "Reduce Only" toggle ensures orders only decrease your position size, preventing accidental increases when trying to exit. Take Profit (TP) and Stop Loss (SL) orders can be attached to positions, automatically closing at profit targets or loss limits.

Managing Open Positions

Monitoring Your Trades

Each open position displays:

• Unrealized P&L: Current profit or loss if closed now
• Entry Price: Your average entry across all fills
• Mark Price: Current oracle price used for P&L calculation
• Liquidation Price: Price level that triggers automatic liquidation
• Funding: Accumulated funding payments owed or earned

‍

Positions update in real-time as prices move. Green indicates profits while red shows losses. The percentage shows your return on the margin used for that position.

Adding or Reducing Positions

You can modify positions after opening by:

• Adding: Trade in the same direction to increase size (this changes your average entry price)
• Reducing: Trade in the opposite direction with "Reduce Only" checked
• Flipping: Trade a larger size in the opposite direction to reverse your position

‍

Each modification incurs the standard 0.10% trading fee. Consider fees when making frequent adjustments, especially for small positions where fees can erode profits.

Understanding Funding Rates

Funding rates balance long and short demand. When more traders are long, longs pay shorts. When more are short, shorts pay longs. Rates are displayed above the chart for each pair.

For example, if BTC shows 0.23% / -0.45%, longs pay 0.23% daily while shorts earn 0.45% daily. Funding accrues continuously from position open and settles when you make any trade in that pair. Consider funding costs for longer-term positions as they can significantly impact returns.

Risk Management

Liquidation Mechanics

Surge uses a 1% maintenance margin requirement. If your account value falls below this threshold relative to your position size, automatic liquidation occurs. Keepers constantly monitor accounts and trigger liquidations to protect the protocol from bad debt. Bad debt occurs when liquidation doesn't recover enough value to cover the position, typically during extreme volatility when prices gap down before liquidation can occur. While the protocol has safeguards including the 1% maintenance margin requirement, bad debt represents a loss that must be absorbed by the system.

The risk meter on the top right of the interface helps visualize your margin usage. During liquidation, your entire position closes at market price and you lose your remaining margin. 

Managing Multiple Positions

With cross-margin, all positions affect your overall risk:

• Correlated positions (multiple longs or shorts) compound risk
• Hedged positions (mixed longs and shorts) can reduce overall exposure
• Monitor total account leverage, not just individual positions
• Consider how liquidation of one position affects others

‍

Diversifying across uncorrelated assets can help, but remember that crypto markets often move together during major events.

Fees and Costs

Trading Fees

Every trade incurs a 0.10% base fee on the position size. For a $1,000 position, you pay $1 to open and another $1 to close. Larger trades may have additional price impact fees if they significantly affect the market.

Funding Costs

Funding payments can be a significant cost or income source:

• Holding positions against the prevailing trend costs funding
• Holding with the minority side earns funding
• Rates change based on market imbalance
• Consider funding when planning hold duration

‍

A position earning 0.5% daily funding can offset trading fees quickly, while paying 0.5% daily can erode profits even on winning trades.

Closing Positions

Manual Closing

To close a position:

1. Go to your positions tab
2. Confirm the size (partial closes are allowed)
3. Review the fees and final P&L
4. Click "Close" on the position
5. Confirm the action in your Radix Wallet

The position disappears from your list and realized P&L reflects in your account balance. Any accumulated funding also settles at this time.

Automatic Closing

Positions close automatically when:

• Stop loss orders trigger
• Take profit targets are hit
• Liquidation threshold is breached
• Auto-deleveraging occurs (rare, during extreme market conditions)

‍

It is recommended to set stop losses for risk management, but be aware that extreme volatility can cause slippage beyond your stop price.

Conclusion

Trading perpetuals on Surge provides powerful opportunities to profit from crypto price movements with leverage and flexibility. The cross-margin system, multiple collateral options, and up to 50x leverage enable sophisticated strategies previously unavailable on Radix.

Success requires understanding both the mechanics and risks. Start conservatively, focus on risk management, and gradually increase complexity as you gain experience. The decentralized nature adds unique considerations like keeper execution and oracle pricing, but also ensures transparent, permissionless access to leveraged trading.

Ready to start trading? Head to surge.trade, fund your account, and get started. 

Disclaimer: This tutorial is for educational purposes only. Trading perpetual futures involves significant risk including total loss of funds. Past performance does not guarantee future results. Always conduct your own research and trade responsibly.

‍