Perpetual Options

Examples

🟩 Example 1: Long Call (Bullish Bet)

✅ Setup

  • BTC Spot Price: $85,381.9
  • Strategy: Alice is bullish and buys a Call Option — BTC-USD-88000-C
  • Strike Price: $88,000
  • Ask Price: $248.9
  • Mark Price: $192.9

🧮 Order Entry

  • Alice can choose to enter the order size in either BTC or USD Spot Notional (Size x Spot Price) terms.
  • Alice enters a $2,000 USD Notional → 0.023 BTC or (2,000 / 85,381)
  • She submits a market buy at $248.9
  • Position Opened:
    • Size: 0.023 BTC
    • Entry Price: $248.9
    • Spot Notional = Size x Spot Price= 0.023 × 85,381 ≈ $1,963
    • 8h Funding Rate: 0.0749% → Expected funding cost per 8h = 0.023 × 0.000749 × 85,381 ≈ $1.47
    • Unrealized PnL at Entry = 0.023 × (192.9 - 248.9) ≈ 1.30 USD
      • Alice has a slight Unrealized PnL at Entry because the Mark Price ($192.9) is below the Entry Price ($248.9)

After 12 Hours

  • Spot Price rises from $85,381 to $87,000
  • Mark Price rises from $192.9 to $503
  • Avg 8h Funding Rate (over 12 hours): 0.08%
  • Avg Spot Price (over 12 hours): $86,000
  • Funding Cost ≈ 0.023 × 0.0008 × 12 ÷ 8 × 86,000 ≈ $2.37

Final PnL

  • Option PnL: 0.023 × (503 - 248.9) ≈ +5.84 USD
  • Less Funding: 2.37 USD
  • Total Unrealized PnL: +3.47 USD
  • PnL %: 3.47 ÷ (0.023 × 248.9) ≈ +61%

🟥 Example 2: Long Put (Bearish Bet)

✅ Setup

  • BTC Spot Price: $85,381.9
  • Strategy: Bob is bearish and buys a Put Option — BTC-USD-83000-P
  • Strike Price: $83,000
  • Ask Price: $233.2
  • Mark Price: $199.8

🧮 Order Entry

  • Bob can choose to enter the order size in either BTC or USD Spot Notional (Size x Spot Price) terms.
  • Bob enters a $1,000 USD Spot Notional → 0.012 BTC
  • Submits a market buy at $233.2
  • Position Opened:
    • Size: 0.012 BTC
    • Entry Price: $233.2
    • Spot Notional = Size x Spot Price =0.012 × 85,381 ≈ $1,024.57
    • 8h Funding Rate: 0.078% → Expected funding cost per 8h = 0.012 × 0.00078 × 85,381 ≈ $0.80
    • Unrealized PnL at Entry = 0.012 × (200.1 - 233.2) ≈ $0.39
      • Bob has a slight Unrealized PnL at Entry because the Mark Price ($200.1) is below the Entry Price ($233.2)

After 12 Hours

  • Spot Price drops from $85,381 to $83,500
  • Mark Price rises from $200.1 to $605
  • Avg 8h Funding Rate (over 12 hours): 0.10%
  • Avg Spot Price (over 12 hours): $85,000
  • Funding Cost ≈ 0.012 × 0.0010 × 12 ÷ 8 × 85,000 ≈ $1.53

Final PnL

  • Option PnL: 0.012 × (605 - 233.2) ≈ +4.46 USD
  • Less Funding: 1.53 USD
  • Total Unrealized PnL: +2.93 USD
  • PnL %: 2.93 ÷ (0.012 × 233.2) ≈ +105%

🟥 Example 3: Short Call (Bearish Bet - Expecting Low Volatility)

✅ Setup

  • BTC Spot Price: $84,332.3
  • Strategy: Charlie is bearish and expects low volatility. He sells a Call Option — BTC-USD-84000-C
  • Strike Price: $84,000
  • Bid Price: $1,112.5
  • Mark Price: $1,140.6
  • 8h Funding Rate: 0.3195%

🧮 Order Entry

  • Charlie can choose to enter the order size in either BTC or USD Spot Notional (Size x Spot Price) terms.

  • Charlie enters a $1,500 USD Spot Notional → 0.018 BTC

  • Submits a market sell at $1,112.5

  • Position Opened:

    • Size: 0.018 BTC
    • Entry Price: $1,112.5
    • Spot Notional = Size x Spot Price =0.018 × 84,332.3 ≈ $1,518
    • 8h Funding Rate: 0.3195% → Expected funding cost per 8h = 0.018 × 0.003195 × 84,332.3 ≈ $4.85
    • Unrealized PnL at Entry = -0.018 × (1,140.7 - 1,112.5) ≈ 0.50 USD
      • Charlie has a slight Unrealized PnL at Entry because the Mark Price ($1,140.7) is above the Entry Price ($1,112.5)

After 12 Hours

  • Spot Price drops from $84,332.3 to $84,000
  • Mark Price drops from $1,140.7 to $961
  • Avg 8h Funding Rate (over 12 hours): 0.35%
  • Avg Spot Price (over 12 hours): 84,200
  • Funding Profit: 0.018 × 0.0035 × 12 ÷ 8 × 84,200 ≈ 7.95 USD

Final PnL

  • Option PnL: -0.018 × (961 - 1,112.5) ≈ +2.73 USD
  • Plus Funding: 7.95 USD
  • Total Unrealized PnL: +10.68 USD
  • PnL %: 10.68 ÷ (0.018 × 1,112.5) ≈ +53%

🟩 Example 4: Short Put (Bullish Bet - Expecting Low Volatility)

✅ Setup

  • BTC Spot Price: $84,410.1
  • Strategy: Dave is bullish but expects low volatility. He sells a Put Option — BTC-USD-84000-P
  • Strike Price: $84,000
  • Bid Price: $701.0
  • Mark Price: $709.2
  • 8h Funding Rate: 0.2801%

🧮 Order Entry

  • Dave can choose to enter the order size in either BTC or USD Spot Notional (Size x Spot Price) terms.

  • Dave enters a $2,000 USD Spot Notional → 0.024 BTC

  • Submits a market sell at $723.0

  • Position Opened:

    • Size: 0.024 BTC
    • Entry Price: $723.0
    • Spot Notional = Size x Spot Price =0.024 × 84,410.1 ≈ $2,024
    • 8h Funding Rate: 0.2801% → Expected funding cost per 8h = 0.024 × 0.002801 × 84,410.1 ≈ $5.67
    • Unrealized PnL at Entry = -0.024 × (730.4 - 723.0) ≈ 0.17 USD
      • Dave has a slight Unrealized PnL at Entry because the Mark Price ($730.4) is above the Entry Price ($723.0)

After 12 Hours

  • Spot Price rises from $84,410.1 to $84,500
  • Mark Price drops from $730.4 to $675
  • Avg 8h Funding Rate (over 12 hours): 0.27%
  • Avg Spot Price (over 12 hours): 84,450
  • Funding Profit: 0.024 × 0.0027 × 12 ÷ 8 × 84,450 ≈ 8.20 USD

Final PnL

  • Option PnL: -0.024 × (675 - 723.0) ≈ +1.15 USD
  • Plus Funding: 8.20 USD
  • Total Unrealized PnL: +9.36 USD
  • PnL %: 9.36 ÷ (0.024 × 723.0) ≈ +54%