> For the complete documentation index, see [llms.txt](https://docs.catapult.trade/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.catapult.trade/mechanics-turbo/futures.md).

# Futures

### Introducing Futures

Futures let you trade with leverage, opening a position larger than your deposited margin. Both longs and shorts are available for all token modes.

The higher the leverage, the more exposure you get from the same margin and the closer your liquidation price.

### How It Works

When you open a futures position in the UI, you set a notional size: the total value of your position, which already includes leverage. Your actual margin, which leaves your balance, is notional divided by leverage, plus a volume fee charged on the collateral. Both are shown in the **Cost** field before you confirm.

*Example:* $100 notional at 10x leverage = $10 margin + $0.1 volume fee (1%).

Once the position is open, your PnL tracks the price move relative to your entry. If the position closes in profit, a 4% fee is taken on the gain. Losses are not charged.

Positions close either when you exit manually or when the token session expires, at which point the position settles at the last price.

### How to Find Futures

![](/files/QDZeOwnizjKbGy6CVvUI)

Open any token from the main page. At the top of the trading panel, you'll see two tabs: **Spot** and **Futures**. Select **Futures** to switch modes. To enter the position, move the leverage slider for your preferred exposure and type the notional amount (= margin \* leverage). The direction buttons allow you to trade both sides and replace the standard buy/sell interface.

### Liquidations

If the price moves against your position far enough, it gets liquidated and the full margin is lost. Because leverage amplifies price moves, the resulting PnL swing can exceed your collateral. Your position is automatically closed when it reaches -100% of margin, since any further loss cannot be compensated.

The liquidation price is calculated from your entry price, leverage, and a buffer:

`Long: P_liq = P_entry * (1 - (1 - buffer) / L)`

`Short: P_liq = P_entry * (1 + (1 - buffer) / L)`

Where `buffer` is the maintenance margin fraction and `L` is leverage.

You can see your exact liquidation price in the Liq. Price field before opening, or use the calculator icon to model different scenarios.

### The Liquidation Buffer

Catapult's charts are generated as a sequence of discrete price ticks. This creates a structural problem: there is no guarantee that any given tick lands exactly at your liquidation price. In practice, the price jumps over it.

The gap between adjacent ticks isn't negligible. Tick-to-tick volatility is small on SLOW but can be as large as \~15% on MAYHEM, meaning a single step can carry the price far past where liquidation should have fired. When that happens, the actual loss at the moment of closing exceeds -100% of deposited margin, and the counterparty absorbs the difference.

This leads to the distortion of price paths. In a continuous GBM with mu=0, expected change is exactly zero at every point. Across infinite paths, gains and losses cancel everywhere. With discrete ticks, this breaks. When a tick crosses the liquidation threshold, the position closes at exactly -100% no matter how far past the threshold the tick actually landed. The true loss at that tick is larger, but the trader pays none of it. For paths that don't liquidate, PnL spreads freely in both directions. For paths that do liquidate, the entire tail of losses beyond -100% collapses to exactly -100%. Across many positions, this amounts to a consistent transfer to the trader equal to the expected overshoot per liquidation event, making futures +EV absent any correction.

The buffer accounts for this. It shifts the liquidation trigger earlier by an amount equal to the expected average overshoot, calculated from the token's tick volatility. Some positions close slightly before the theoretical -100% point, some overshoot past it, but the buffer is calibrated so these effects cancel in expectation, bringing the EV of futures outcomes back to zero.

### Current Limits

Maximum notional per position is currently $20,000. Limits will be increased over time.

*Keep in mind:* for the same notional, higher leverage means lower margin, but also a tighter liquidation range. Adjust leverage based on how much room you want to survive the chart's movement before your target plays out.