Coinbase International Exchange

Margin Offset

What is Margin Offset?


Margin Offset allows for the reduction of total margin required for a portfolio of perpetual future positions on Coinbase International Exchange. It provides greater capital efficiency and flexibility by considering the correlation or risk offset between positions. 

How does Margin Offset work?

Margin Offset calculates the credit towards portfolio initial margin and pre-trade margin requirements for specific opposite-sided positions. The offset notional value is priced using the position volume-weighted average price (VWAP) and is updated on every mark to market, successful order entry, and fill for the associated portfolio. It's important to note that closing positions with offsets may require additional collateral if the closing order requires it.

Each portfolio will calculate the margin offsets based on our risk calculation.  Positions in one portfolio will not offset directly against positions in another portfolio. At the User's Business Organization (UBO) level, the offset calculation will be a notional weighted average of the portfolio-level offsets of the underlying portfolios and applied to the account level margin requirements. 

Example:


What Positions are Eligible and What are the Offset Weights?


Please refer to the below table on the list of perpetual futures available for offset. The priority ordering in the table is the sequence in which pair-wise offsets will be calculated. 

Margin Offset Table (As of 24 May 2024)

Priority

Contract 1

Contract 2

Offset

1

BTC-PERP

ETH-PERP

0.40

Note: The margin offset table are based on current market conditions and are subject to change

To view the Notional Amount your Initial Margin has been offset within a portfolio please refer to position_offset_notional in the Portfolio Summary endpoint. 

How to Opt-in to Margin Offset Mode?

To opt-in to Margin Offset mode, users can enable it at an individual portfolio level via API.