Academy Trading Ideas Article

Option Trading Guide

2020.01.17

Open OKEx official website at http://www.okex.com, and select at the top menu bar “Trade” then “Options”.

You will enter the options trading page. Before you start your first options trade you need to open an account. To open an account, click “Activate Options Account” located in the center of the page. You will need to pass some quizzes after you have passed the quizzes your account will be activated.

OKEx currently offers options contracts with four different due dates. Let’s take BTCUSD options as an example, click “All Options” then “All” you will be able to view all BTCUSD options available on the platform.

In the options list, you can see the market information such as the market price, mark price and the trading volume of each option. The left side of the list is information about call options, the right side is information about put options and the middle column is the strike price of the options.

You can choose the call or put option that you want to trade in the list:

For example, if you choose BTCUSD put option with expiry date of March 27, 2020, and a strike price of 5,500 USD, to buy or sell. The option price you want to buy is 0.005 BTC, and the amount you enter is 1. Click “buy” to place an order. Since the face value of BTCUSD options on OKEx is 0.1 BTC, the actual payment after the buy order is filled as 0.005 * 1 * 0.1 = 0.0005 BTC

Selling requires short qualification, which can be enabled by passing quizzes. Selling options requires that the account available asset is not less than 0.2 BTC (or equivalent of other assets), or the trading volume of the option account in the last 30 days is not less than 2 BTC (or equivalent of other assets)

If the order price of a sell order is higher than the current bid price, the order will either be in the sell orders or be filled directly.  If the order price of a buy order is lower than the ask  price, the order will either be in the buy orders or be filled directly. The order can be canceled before being filled. You can also click to enter the details page and modify the order amount and order price at the bottom.

After the order is done being filled, the position amount will be displayed on the open positions. If selling 1 option contract, the position will be displayed as -1; if buying 1 option contracts, the position will be displayed as 1. You can close position directly on open options page.

After you open an option position, be careful with risk control. When the account balance is about to reach the maintenance margin, it means that the position is facing greater risk; when the account balance is lower than the maintenance margin, your position will be liquidated.

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