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Understanding Derivatives Trading
A derivative trading is a contract between two or more parties that based the trade on an asset that represents an underlying financial asset. It is generally used by traders to speculate on the forecasted price fluctuations of an underlying financial asset, without having to purchase the actual financial asset.
In this case, AlphaX is a form of derivative trading since our Strike Tokens derive their value from the underlying financial assets, like AVAX or ETH token.
So by buying an AVAX Strike Token, LONG or SHORT, you are not actually purchasing an AVAX token but a representation of AVAX and its price speculation (bullish or bearish). However, unlike other forms of derivative trading, AlphaX allows you to hold this derivative asset in a tokenized form in which you can earn on-top profit yields through liquidity providing. Learn more here.
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