South Korea Warns Offshore Perpetual Futures Can Wipe Out Investments

South Korea’s Financial Services Commission (FSC) cautioned local investors Oct. 16 that offshore perpetual futures can magnify small price swings into a full loss, while Korean protections may not apply. The contracts can reference stocks, crypto assets and other underlying assets. They may use leverage from 10 to 200 times, trade continuously and have no fixed maturity or scheduled delivery date. At 150 times leverage, an adverse move of about 0.66% in a Korean stock-index contract could trigger forced liquidation of the entire position. Losses can build before a trader has time to add margin.

Source: TokenPost