1. How Futures Spreads Are Traded in Crypto
Spread trading involves simultaneously taking two opposing futures positions: one long and one short. Traders profit from the price difference (or spread) between these contracts, known as the strategy's legs. This approach is market neutral, meaning profitability isn't tied to the underlying asset's price direction.
Key Spread Types in Crypto:
- Calendar Spread: Trades contracts with the same underlying asset and quantity but different expiry dates (e.g., BTC-30SEP24 long vs. BTC-31DEC24 short).
- InterCoins Spread: Capitalizes on price differences between highly correlated assets (e.g., ETH vs. SOL futures).
👉 Learn more about futures spreads
2. Challenges of Futures Spread Trading
While lucrative, spread trading presents hurdles:
- Execution Risk: Entering legs sequentially on order books may lead to unfavorable prices during volatility.
- Limited Customization: Many platforms restrict instrument availability.
- Price Slippage: Thin order books can cause large trades to execute at unintended prices.
3. OKX Liquid Marketplace Solutions
OKX’s Liquid Marketplace tackles these issues with off-order-book execution and deep liquidity.
Advantages:
Cost Efficiency
- Competitive RFQs: Request custom quotes from multiple market-makers.
- Simultaneous Execution: Both legs trade atomically—eliminating partial fills.
- Portfolio Margin: Lower margin needs by offsetting opposing positions.
Diverse Instruments
- 20+ Predefined Strategies: Includes calendar spreads, straddles, and butterfly spreads.
- Custom Multi-Leg Trades: Build strategies with up to 15 legs.
👉 Explore OKX’s liquidity solutions
FAQs
Q: Is futures spread trading risky?
A: While market-neutral, risks include execution slippage and liquidity gaps. OKX’s tools mitigate these.
Q: Can I trade spreads on low-correlation assets?
A: Focus on highly correlated pairs (e.g., BTC/ETH) for stable spreads.
Q: Does OKX support bespoke spreads?
A: Yes—customize strategies with multiple legs via RFQs.
Disclaimer: This content is informational only and not investment advice. Digital assets are volatile; assess risks before trading.