Perpetuals are derivative contracts that let you speculate on the price of an underlying asset—such as crypto—without ever owning the asset directly. Instead of buying or selling the asset itself, you trade contracts that track its price.

Unlike traditional futures, perpetual futures do not expire. This gives you flexibility to hold a position as long as you meet the collateral requirements.

When you hold a long position, you can profit when the price goes up. Holding a short position can be profitable when the price goes down. However, if the market moves against your position, you can incur losses. Profits and losses (P&L) are settled every 15 minutes. Commissions and exchange fees are charged when your order fills and are shown on the order receipt.

With perpetual futures, you have the option to use leverage. This means you can open a larger position with less money upfront. While leverage can increase your potential profits, it can also increase your risk of losses.

Perpetuals offer many benefits but also come with significant risks, especially when using leverage.

Benefits

• Trade on rising and falling prices: Open long and short positions based on how you view the market.
• No expiry: Positions can stay open as long as you meet collateral requirements. Unlike traditional futures, you don’t need to roll contracts over.
• Leverage: Up to 10x on select contracts. Maximum leverage varies by contract and is shown in the app.
• Hedge your portfolio: Open a short position to offset losses in an asset you already hold without having to sell your underlying position.
• More trading hours: You can place orders and manage positions 24 hours a day, 7 days a week.
• Funding rate opportunities: If you hold a position during a funding window (which occurs every 8 hours), you may receive or pay a funding rate depending on the current market conditions.
• You do not need to own the underlying asset: Perpetuals give you price exposure without holding the underlying asset.

Risks

• Liquidation: If your collateral drops below the required level, your position may be partially or fully liquidated. This means you could lose some or all of the collateral you posted.
• Increased risk of losses: Using leverage increases the size of your positions, which amplifies potential losses too.
• Price difference: During periods of high market volatility or low liquidity, the price of a perpetual contract may deviate from the spot price.
• Active position management required: Since perpetuals don’t have an expiry, it’s your responsibility to continually monitor the health and collateral levels of your open positions.

Robinhood shows in-app risk indicators and offers optional take profit and stop loss orders to help you manage risk. But it’s important you understand how perpetuals work, how leverage can impact your potential profits and losses, and how to effectively use the risk management tools before you trade perpetuals.

In rare cases, trading may be temporarily paused to maintain system integrity, like during major market events or if technical issues arise at our partner venue that executes the trades.

Trading perpetuals requires an active futures account. If you're already approved for futures, you can trade perpetuals without an additional approval.

If you do not yet have a futures account, you can get started with perpetuals trading by going to Profile (person icon) → Menu (3 bars) → Investing → Enable perpetual futures trading.

Details about each contract can be found on the perpetuals detail page. Tap the info icon (i) for information about each metric in the app including:

• Bid price x size: The highest price a trader is willing to pay for the contract. The size shows how many contracts are available at that price.
• Ask price x size: The lowest price a trader is willing to sell the contract for. The size shows how many contracts are being offered at that price.
• Mark price: The current estimated value of a contract, based on the index price and recent market activity. Long positions are liquidated when the mark price falls below the liquidation price, and short positions when it rises above the liquidation price.
• 24h change: The difference between the last traded price and the price 24 hours ago.
• Funding rate: A periodic payment between long and short traders that helps keep the contract price in line with the price of the underlying asset. When funding rates are positive (i.e., the perpetual futures price is greater than the spot price), long positions pay short positions, and when funding rates are negative (i.e., the perpetual futures price is less than the spot price), short positions pay long positions. Payments occur every 8 hours and will increase or reduce your collateral balance depending on the funding rate at the time of settlement.
• Next funding countdown: The time remaining until the next funding rate payment is applied to open positions.
• Open interest: The total number of open contracts on the trading venue.
• 24h volume: The total notional value of all contracts traded in the past 24 hours on the trading venue.
• 24h high: The highest last traded price in the past 24 hours on the trading venue.
• 24h low: The lowest last traded price in the past 24 hours on the trading venue.

When trading perpetual futures, it is important to know the difference between a position and an order.

An order is an instruction to open, modify, or close a position. You can place different types of orders, like market or limit.

A position is the actual exposure you have in the market after an order is filled.

• Positions update in real time as the market moves
• Go long if you think the asset price will increase or go short if you think it will decrease
• Positions can stay open as long as you have enough collateral to support your position

When trading perpetual futures on Robinhood, you must maintain a certain amount of collateral to open and maintain your positions. These requirements are set by the exchange and depend on the specific contract, your position size, and your selected leverage. View Perpetual futures collateral tiers and leverage for more information.

Collateral required is the amount needed to open a position at your selected leverage (for example, 10% of notional at 10x). It's recalculated every 15 minutes at settlement. If your total collateral falls below the collateral required, orders that would increase your exposure are canceled and new ones are rejected until you add collateral or the position recovers.

The minimum amount required to maintain an open position. Below this level, the position will begin to be liquidated. View Perpetual futures liquidations for more information.

Both are set by the exchange and depend on contract and position size.

Robinhood currently offers up to 10x leverage on select contracts for eligible traders.

Unlike traditional futures contracts, perpetual futures on Robinhood technically don’t have an expiry date. That’s what makes them perpetual. However, settlements occur every 15 minutes where profits and losses are settled. Perpetuals are designed to let you hold a long or short position indefinitely, as long as you meet the collateral requirements.

• There is no expiration date like with standard futures contracts.
• You do not have to worry about rolling your position over.
• You can choose to close your position at any time.

You may be restricted from trading perpetuals if:

• You live in a restricted region
• You have a position being liquidated
• System-wide limits or restrictions are required

Perpetuals markets on Robinhood are open 24 hours a day, 7 days a week—including weekends and holidays. You can open, modify, and close positions at any time.

The trade day is considered to end at 5 PM ET for purposes of account statements and history.

If you close a position with a profit or loss, you may be subject to taxes. For your specific tax situation, we recommend you consult with a tax professional.

Perpetuals are complex derivative products, and trading involves significant risk and is not appropriate for all investors, particularly for perpetuals referencing assets which experience volatile price movements. Further, leveraged trading is risky as it can amplify the speed of your losses and increases the chance of you losing all of your initial investment. Please carefully consider if investing in such financial instruments is appropriate for you in light of your specific experience, risk tolerance, and financial situation. Restrictions and eligibility requirements apply.