The pricing mechanism of ETF

Pricing mechanism

Leveraged ETFs are essentially to ensure that ETF holders enjoy a fixed target multiple of the daily return on the underlying asset by fixing the returns of the leveraged fund. Therefore, the value of the ETF product is the net value of its fund, which tracks the position of a basket of futures of the corresponding crypto.

The platform will announce the net value of the fund in time to maintain a high degree of transparency.

Theoretically, the net value of a fund is the fair-trading price of ETF product in the secondary market. However, due to fluctuations in market, there may be a situation where the secondary market trading price deviates from the net value of the ETF in a certain period of time, resulting in a certain premium.

When the premium exists, arbitrage opportunities will arise, and arbitrageurs in the secondary market can gradually eliminate the premium through arbitrage operations, ensuring that the product trading price closely follows the fair price. Users should pay attention to their order price not to deviate too much from the net value to avoid losses

At the same time, when the net value price is lower than 0.1 USDT, there will be a merger mechanism to change the net value price to 10 times before the merger, but the corresponding amount will also become 1/10 before the merger, and the user’s total assets will not be affected in any way to improve the sensitivity of price changes and optimize the trading experience.

Calculation of the net value of the fund

Calculation of the net value of the fund

ETF fee rates

Unlike other derivative products, margin and futures, ETFs charge a fund management fee of 0.001% per day, and in the case of holding equivalent products, ETF holdings cost less than futures and margin trading.

In addition, the same as spot trading, you pay a 0.2% transaction fee when trading ETF products, and you can also use MX Token to enjoy a 20% discount on the fee.

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