Leverage is the foundation of modern trading with maximum potential

Leverage is essentially a financial instrument that allows traders to control positions much larger than their actual investments. In traditional derivative trading, this often means extreme risks — a position can be liquidated with minimal price movement. However, a new generation of structured products, such as smart leverage, is changing this approach. Smart leverage is not just a tool for ambitious traders — it rethinks how to operate more safely in highly volatile markets.

What exactly is smart leverage and how does it work

Based on recent developments in structured products, smart leverage is a specialized financial instrument without guaranteed principal return. It is designed with one goal: to help traders navigate periods of extreme market instability by allowing them to place bets in one direction with maximum leverage, while significantly reducing liquidation risks during a specified period.

The key difference lies in the protection mechanism. Unlike standard derivative trading, where a position can be instantly liquidated, smart leverage is a system that protects your position from unexpected price swings until settlement. The outcome is determined not continuously, but only at the end of the contract — this is a fundamental difference from classic trading.

Who is smart leverage designed for

This product is ideal for a specific category of market participants. First, traders who need extremely high leverage (up to 200x for certain contracts) but cannot afford the risks of immediate liquidation. Second, those confident in the direction of their position — for example, traders expecting a V-shaped market recovery or confident in a prevailing trend.

The third category includes investors who prefer early closing of positions, although this is only possible if the expected result is positive. Additionally, users seeking to avoid liquidation before official settlement will find this product exactly what they need.

Comparison: traditional derivative trading vs. smart leverage

To better understand the advantages, consider a concrete example. In traditional derivative trading, a trader opening a long position with 100x leverage risks liquidation with just a 1% price fluctuation. This means an extremely narrow margin for movement, making trading with such leverage levels almost inaccessible to most participants.

Smart leverage offers an alternative. Since you can choose your leverage level based on your personal risk tolerance, price fluctuations until settlement do not affect the size of your invested amount. Even if the price drops below the breakeven point, your position will not be closed — it will wait until settlement. This radically changes the risk dynamics.

How the protection against liquidation works

Smart leverage is, in essence, insurance against liquidation until settlement. The system works as follows: instead of constantly checking your position against the current market price, it locks in the result until a set time. You can hold your position even during significant negative fluctuations because the outcome is determined not “here and now,” but only at settlement.

This is especially useful in V-shaped markets, where prices sharply fall but then quickly recover. Traditional high-leverage trading would liquidate the position during the dip, causing you to miss the rebound. Smart leverage maintains the position throughout this sequence.

How profits and losses are calculated

The outcome is based on a simple but important formula. For long positions:

If the settlement price ≥ breakeven price: you receive your investment plus profit, calculated as: Payout = Investment amount + [Investment amount × Leverage × (Settlement price - Breakeven price) / Breakeven price]

If the settlement price < breakeven price: payout is calculated using the same formula but with a minimum guarantee of zero. This means that in the worst case, you lose your initial investment but no more.

For short positions, the logic is similar but inverted: a profitable position occurs when the settlement price drops below the breakeven.

Key parameters and their definitions

Breakeven price is dynamically determined based on several factors: current market volatility and the remaining time until contract expiration. The higher the volatility, the higher the breakeven price; the less time remaining, the more it is adjusted.

Settlement price is calculated as the average index price of derivatives, taken every second over the 30 minutes before the contract expires. This prevents price manipulation at the last moments. If you close your position early, the settlement price will be the index price at the moment of your request.

Practical conditions: from activation to payout

When you place an order, the smart leverage plan is created immediately, but the exact activation time is specified in the “Order Time” (UTC) section on the order page. When the settlement time arrives (for example, T+1 at 08:00 UTC), profits and the initial investment will be credited to your funding account within 15 minutes (in this example — by 08:15 UTC).

You are also allowed to request early payout at any time before settlement. In this case, the payout is calculated using the same formula, but the settlement price is the index price at the moment of your payout request. However, early payout is not available if the expected result is negative or zero, and the function is also unavailable within an hour before the official settlement.

Limitations and access requirements

To purchase smart leverage plans, certain users must undergo Level 1 identity verification. Private companies can also access this product. Regarding investment amounts, there are minimum limits in the order zone, but no maximum total amount per user is set.

It is important to note: no fee is charged for using smart leverage. Your profit is generated through active management of your funds by professional third-party firms conducting strategic trading on the platform.

Understanding risks and potential losses

Smart leverage is, without question, a specialized product with its own risk profile. The most important thing — understand that you can lose your entire invested amount if the settlement price at the end drops below (for long positions) or rises above (for short positions) the established breakeven price.

While the product protects you from liquidation during the contract’s duration, it does not guarantee profit. Before placing an order, it is strongly recommended to model expected outcomes based on different scenarios to fully understand the associated risks. Additionally, there may be slight discrepancies in actual returns (no more than 0.5%) due to market movements.

Features for advanced users

If you use sub-accounts for trading, good news: you can also purchase smart leverage plans through them. This expands portfolio management flexibility for complex trading structures.

The source of profit from smart leverage is active management of your funds by professional traders and managers working on the platform, utilizing strategic trading to generate income.

Smart leverage is an innovation that demonstrates the evolution of structured products in response to traders’ needs for higher exposure without extreme risks of instant liquidation. However, like any financial product, it requires a deep understanding of its mechanics and a clear assessment of your own risk tolerance.