Identifier: C6T5L4 | Revision: 2026-10-26 | Planned study: 10–15 minutes, excluding extended practice.

Decision and objectives

Decision: A perpetual hedge needs a cash-path and venue plan; index, mark and execution prices have different roles. Objectives: Calculate perpetual funding cash; Distinguish index, mark and execution prices; Stress liquidation and opposing-position reduction. Prerequisite: C6T5L3.

All numerical offers, rates, prices, account chains, fees and contract parameters below are hypothetical, unless a primary document is expressly identified. They are not current executable offers or evidence that a Turkey-resident investor can access them. The assumed investor is a Turkey-resident individual outside a business, with no assumed US citizenship or tax residence; actual classification must be checked. Results are before actual tax unless a fictional tax schedule is explicitly supplied. No account, deposit or trade is required.

Mechanics

A perpetual derivative has no scheduled expiry forcing convergence. Funding encourages alignment with an index but does not guarantee it. Index price aggregates specified inputs; mark price drives risk calculations; actual trade and liquidation prices can differ. Funding sign, accrual, interval and currency are venue-specific. The linked Deribit inverse contract is one current example; the linear exercise below declares different synthetic terms. Continuous trading does not guarantee withdrawals or legal access.

Price and return drivers

For the stipulated linear contract, price profit is base quantity × (exit − entry). Funding uses the contractual observation notional and rate; positive funding is paid by longs here. Margin equity includes price profit, funding and charges. Failure of maintenance can trigger liquidation before the planned exit. Auto-deleveraging (ADL) is separate: some venue rules permit reducing opposing positions during liquidation/default stress. An insurance fund is not assumed to guarantee every customer claim or a grace period.

Worked case

Buy synthetic 0.4 BTC linear perpetual at USD 50000/BTC, collateral 1000, fixed maintenance 500. At exit 49000, price loss is 400. Three funding observations use constant notional 20000 only to isolate funding, with rates +0.01%, +0.02%, −0.01%: pay 2, pay 4, receive 2, net pay 4. Trading fees 20 leave net loss 424 and equity 576 if the path survives. No actual venue margin or funding parameter is copied into the case.

Adverse case

Counterfactual exits 48000, 50000 and 52000 give net −824, −24 and +776, and equity 176, 976 and 1776. The first falls below maintenance; a continuously checked account would not survive without additional cash. Ignoring fees and funding only to isolate price, 1000 + 0.4 × (price − 50000) = 500 gives boundary 48750. A gap can execute lower, so this is not a guaranteed liquidation price. ADL can separately reduce a profitable hedge while its underlying exposure remains. Interim risk and final arithmetic must be reported separately.

Practical use

Read actual units, settlement asset, index inputs, mark method, funding accrual, margin mode, liquidation, ADL and withdrawal terms. Verify the contracting entity and jurisdiction. Provider pages support narrow mechanics comparisons and do not establish domestic authorization or investor permission. Include the quoted spread, commission, funding, custody, conversion and exit charges applicable to the actual route. Check investor residence/status, acquisition and income dates, effective tax rules and treaty scope before applying any actual tax; these cases remain before actual tax.

Decision boundaries

Decline a perpetual hedge that cannot survive the combined cash and venue stress. Short perpetuals against crypto holdings retain funding, basis, collateral and custody risks. Unwithdrawable profits cannot fund an external bill. A listed future changes legal and clearing arrangements but still needs verified permissions, roll and cash resources. Keep the actual loss-allocation clause distinct from a marketing claim of limited leverage.

Practice and references

Exercise: synthetic linear perpetual long 0.2 BTC at USD 40000/BTC, exit 41000, constant funding notional USD 8000, two funding rates +0.02% paid by the long, total fees USD 8 and starting collateral USD 500. Assume the path survives liquidation. Calculate net result and closing equity. Solution: price gain is 200, funding 3.20 and net 188.80. Closing equity is 688.80. A positive ending result alone would not establish that an actual earlier risk-engine mark avoided liquidation.

Takeaway: A perpetual hedge needs a cash-path and venue plan; index, mark and execution prices have different roles. References: product card, formula; glossary: Perpetual; Funding rate; Mark price; Auto deleveraging. Next: C6T5L5. Topic test.

Sources: GIB: Investment Income Guide (retrieved 2026-10-26; Introduction and foreign income/reporting framework). Deribit: Inverse Perpetual (retrieved 2026-10-26; Settlement coin, USD contract unit and funding mechanism). Deribit: Liquidations (retrieved 2026-10-26; Risk engine, incremental liquidation and account control). CFTC: Understand Risks of Virtual Currency Trading (retrieved 2026-10-26; Leverage, venue and index risks). Bybit: Auto-Deleveraging Mechanism (retrieved 2026-10-26; Mechanism,opposing positions and venue discretion). Revision: 2026-10-26; recheck changeable rules before publication.

Shared reference guide