Perpetual Futures Guide

A comprehensive step-by-step guide to trading perpetual futures on Med.Fun with up to 101x leverage.

High Risk Warning: Perpetual futures trading with leverage is extremely risky and can result in the loss of your entire position. This guide is educational. Never risk more than you can afford to lose, and always use stop-losses.

Prerequisites

Before you start trading perpetuals:

  1. ✅ Have a Med.Fun account (sign up if needed)

  2. ✅ Fund your wallet with SOL

  3. ✅ Understand basic trading concepts

  4. ✅ Read Perpetual Futures Overview

  5. ✅ Start with small amounts to learn

Step 1: Access the DEX

Desktop

  1. Click "DEX" in the top navigation bar

  2. The full trading interface will load

Mobile

  1. Tap the "DEX" icon in the bottom navigation

  2. Swipe between Trade, Chart, Positions, and Orders tabs

Step 2: Create a Drift Account

You need a Drift account to trade perpetual futures (one-time setup).

  1. On the DEX page, you'll see "Create Drift Account" button

  2. Click the button

  3. A transaction will appear in your wallet - this creates your trading account

  4. Approve the transaction (small SOL fee)

  5. Wait for confirmation (~1 second)

  6. Your Drift account is now active!

Your Drift account is separate from your wallet. Think of it as your "trading balance" - you deposit funds into it to trade.

Step 3: Deposit Funds

Transfer SOL from your wallet to your Drift account:

  1. Look for "Deposit" button (usually in account widget)

  2. Click "Deposit"

  3. Enter the amount of SOL you want to deposit

  4. Click "Confirm Deposit"

  5. Approve the transaction in your wallet

  6. Funds will appear in your Drift account balance

How Much to Deposit:

  • Beginners: Start with $50-100 worth of SOL

  • Intermediate: $100-500

  • Advanced: Based on your risk tolerance

Remember: Only deposit what you can afford to lose.

Step 4: Choose a Market

Select which perpetual market you want to trade:

  1. Click the Market Selector (shows current market like "SOL-PERP")

  2. Browse available markets

  3. Review each market's:

    • Current price and 24h change

    • Funding rate

    • Open interest

    • Volume

  4. Click your chosen market

Popular Markets:

  • SOL-PERP: Solana perpetual futures

  • More markets may be available - check the selector

Step 5: Analyze the Market

Before entering a position, analyze market conditions:

Check the Chart

  • Is the trend up (bullish) or down (bearish)?

  • Are there clear support/resistance levels?

  • What's the recent volatility?

Review the Order Book

  • Look at buy/sell pressure

  • Check spread between bids and asks

  • Note large orders that might act as support/resistance

Check Recent Trades

  • What's the trading volume?

  • Are trades mostly buys or sells?

  • What's the average trade size?

Review Funding Rate

  • Positive rate: Longs pay shorts (market is bullish)

  • Negative rate: Shorts pay longs (market is bearish)

  • High rates may indicate overleveraged positions

Step 6: Decide on Position Direction

Choose whether to go Long or Short:

Go Long (Buy) When:

  • You believe price will go up

  • Chart shows uptrend

  • Positive news or sentiment

  • Support level is holding

  • You want to profit from price increases

Go Short (Sell) When:

  • You believe price will go down

  • Chart shows downtrend

  • Negative news or sentiment

  • Resistance level is holding

  • You want to profit from price decreases

Step 7: Select Order Type

Choose the right order type for your strategy:

Market Order (Immediate Execution)

Best for:

  • Entering position quickly

  • High liquidity markets

  • When exact price doesn't matter

How to use:

  1. Select "Market" order type

  2. Enter position size

  3. Click "Long" or "Short"

  4. Order executes immediately at current price

Limit Order (Price-Specific)

Best for:

  • Getting better entry price

  • Patient traders

  • Lower liquidity markets

How to use:

  1. Select "Limit" order type

  2. Enter desired entry price

  3. Enter position size

  4. Click "Long" or "Short"

  5. Order sits on order book until price reaches your limit

Example:

  • SOL trading at $150

  • You want to buy at $145

  • Set limit order at $145

  • If price drops to $145, order fills

Step 8: Set Your Leverage

Choose leverage carefully - it multiplies both profits AND losses:

Leverage Guidelines

Conservative (2x-5x):

  • Best for beginners

  • Lower liquidation risk

  • More room for price movement

  • Recommended starting point

Moderate (5x-20x):

  • For experienced traders

  • Balance between risk and reward

  • Requires monitoring

  • Use stop-losses always

Aggressive (20x-101x):

  • Expert traders only

  • Extreme liquidation risk

  • Small price moves = big impact

  • Requires constant monitoring

How to Set Leverage:

  1. Look for leverage slider or input

  2. Move slider or enter leverage multiplier

  3. Watch liquidation price update

  4. Choose leverage you're comfortable with

  5. Lower leverage = safer

Example:

  • $100 with 10x leverage = $1,000 position

  • $100 with 50x leverage = $5,000 position

  • Higher leverage = higher risk!

Step 9: Calculate Position Size

Determine how much to risk on this trade:

Position Sizing Rules

The 1-2% Rule:

  • Never risk more than 1-2% of your account per trade

  • If you have $1,000, risk max $10-20 per trade

  • This helps you survive losing streaks

How to Calculate:

  1. Determine your account size

  2. Decide risk percentage (1-2%)

  3. Calculate max loss amount

  4. Set position size accordingly

Example:

  • Account: $1,000

  • Risk: 2% = $20 maximum loss

  • Stop-loss: 5% from entry

  • Position size: $400 (so 5% of $400 = $20 loss)

Step 10: Set Stop-Loss

Critical: Always use a stop-loss to limit potential losses.

What is a Stop-Loss?

A stop-loss automatically closes your position if price moves against you by a certain amount, limiting your loss.

How to Set Stop-Loss:

  1. Decide maximum loss you'll accept (e.g., 5% of position)

  2. Calculate stop-loss price

  3. Enter stop-loss in order form

  4. Confirm it's active

Examples:

Long Position:

  • Entry: $150

  • Stop-Loss: $145 (3.3% below entry)

  • If price drops to $145, position closes automatically

Short Position:

  • Entry: $150

  • Stop-Loss: $155 (3.3% above entry)

  • If price rises to $155, position closes automatically

Stop-Loss Tips:

  • Place below support (for longs) or above resistance (for shorts)

  • Don't place too tight (normal volatility will stop you out)

  • Don't place too wide (risk becomes too large)

  • 2-5% is typical for leveraged positions

Step 11: Set Take-Profit (Optional but Recommended)

Lock in gains automatically by setting a take-profit order.

What is Take-Profit?

Automatically closes your position when it reaches your profit target, securing your gains even if you're not watching.

How to Set Take-Profit:

  1. Decide profit target (e.g., 10% gain)

  2. Calculate take-profit price

  3. Enter take-profit in order form

  4. Confirm it's active

Examples:

Long Position:

  • Entry: $150

  • Take-Profit: $165 (10% above entry)

  • Position closes automatically at $165

Short Position:

  • Entry: $150

  • Take-Profit: $135 (10% below entry)

  • Position closes automatically at $135

Take-Profit Strategy:

  • Set realistic targets based on chart levels

  • Consider taking partial profits (close 50% at first target)

  • Adjust based on market conditions

  • 5-20% is typical depending on leverage

Step 12: Review and Confirm

Before submitting your order, double-check:

Pre-Trade Checklist:

  • ✅ Direction correct (Long or Short)?

  • ✅ Position size appropriate?

  • ✅ Leverage suitable for your risk?

  • ✅ Stop-loss set?

  • ✅ Take-profit set?

  • ✅ Sufficient funds in Drift account?

  • ✅ Liquidation price acceptable?

  • ✅ Order type correct (Market/Limit)?

Review Key Metrics:

  • Entry Price: Where you'll enter

  • Position Size: Total exposure

  • Leverage: Risk multiplier

  • Margin Required: Collateral needed

  • Liquidation Price: Where position gets liquidated

  • Stop-Loss: Your maximum loss point

  • Take-Profit: Your profit target

If everything looks good, proceed!

Step 13: Execute the Trade

Time to enter your position:

  1. Click "Open Long" or "Open Short" button

  2. Review final confirmation dialog

  3. Approve transaction in your wallet

  4. Wait for confirmation (usually <1 second)

  5. Position appears in "Positions" tab

After Execution:

  • You'll see your open position immediately

  • P&L starts updating in real-time

  • Monitor liquidation distance

  • Set alerts if needed

Step 14: Monitor Your Position

Active management is crucial for leveraged trading:

What to Watch:

Unrealized P&L:

  • Current profit or loss

  • Updates in real-time

  • Not realized until you close

Liquidation Price:

  • Price at which you'll be liquidated

  • Watch distance to liquidation

  • Add margin if getting close

Market Conditions:

  • Check chart regularly

  • Watch for trend changes

  • Note major support/resistance

Position Time:

  • How long you've been in the trade

  • Remember funding rates (paid every 8 hours)

  • Don't hold indefinitely without reason

Monitoring Tools:

Desktop:

  • Full chart with your position marked

  • Real-time P&L in positions table

  • Price alerts

  • Multiple monitors if available

Mobile:

  • Positions tab shows key metrics

  • Set push notifications for price alerts

  • Check regularly throughout the day

Step 15: Managing the Position

Adjust your position as market conditions change:

Adding Margin

If position is moving against you and you're confident:

  1. Click "Add Margin" on your position

  2. Enter amount to add

  3. This lowers your liquidation price

  4. Gives position more room to breathe

Adding margin means risking more capital. Only do this if you have strong conviction.

Moving Stop-Loss

As position moves in your favor:

  1. Trail your stop-loss - move it closer to current price

  2. Lock in profits while staying in the trade

  3. Reduce risk as trade becomes profitable

Example:

  • Entry: $150, Stop: $145

  • Price moves to $160

  • Move stop to $155 (breakeven + small profit)

  • Now you can't lose, only profit or breakeven

Partial Close

Take profits while keeping some exposure:

  1. Close 25-50% of position at first target

  2. Keep rest running with stop at breakeven

  3. This secures some profit while maintaining upside

Step 16: Closing Your Position

Time to exit - either hitting targets or cutting losses:

Closing Methods:

Method 1: Market Close (Immediate)

  1. Go to "Positions" tab

  2. Click "Close" on your position

  3. Select "Close 100%" (or partial amount)

  4. Confirm - closes at current market price

  5. Instant execution

Method 2: Limit Close (At Specific Price)

  1. Go to "Orders" tab

  2. Create new limit order in opposite direction

  3. Set your desired exit price

  4. Order sits on book until filled

Method 3: Stop/Take-Profit Triggers

  • If you set these earlier, they'll close automatically

  • No action needed from you

  • Executes when price reached

When to Close:

Close Winning Trades:

  • Take-profit target hit

  • Trend showing weakness

  • Strong resistance ahead

  • Funding rate becoming expensive

Close Losing Trades:

  • Stop-loss hit (automatic)

  • Trade thesis no longer valid

  • Market conditions changed

  • Approaching liquidation

Never:

  • Let position get liquidated

  • Hold losing trade hoping it comes back

  • Ignore your stop-loss

  • Keep position without reason

Step 17: Review and Learn

After closing, analyze the trade:

Post-Trade Review:

  1. Record the Trade:

    • Entry/exit prices

    • Position size and leverage

    • Reason for entering

    • What you did right/wrong

    • Lessons learned

  2. Calculate Results:

    • Total P&L (including fees)

    • Return on margin (%)

    • Hold time

    • How close to liquidation you got

  3. Analyze Execution:

    • Did you follow your plan?

    • Were stop/take-profit levels good?

    • Was position size appropriate?

    • What would you do differently?

  4. Update Your Strategy:

    • What worked?

    • What didn't?

    • Adjust rules for next trade

    • Note patterns in your wins/losses

Common Mistakes to Avoid

1. Overleveraging

❌ Wrong: Using 50x-101x leverage as a beginner ✅ Right: Start with 2x-5x leverage, increase slowly with experience

2. No Stop-Loss

❌ Wrong: Entering without stop-loss, hoping for the best ✅ Right: Always set stop-loss before entering

3. Revenge Trading

❌ Wrong: Doubling position size after a loss to "make it back" ✅ Right: Take a break after losses, stick to position sizing rules

4. Ignoring Liquidation Price

❌ Wrong: Not checking how close you are to liquidation ✅ Right: Always know liquidation price, add margin if too close

5. Emotional Decisions

❌ Wrong: Moving stop-loss further away when position moves against you ✅ Right: Respect your stop-loss, take the loss and move on

6. Overtrading

❌ Wrong: Making 20+ trades per day trying to catch every move ✅ Right: Wait for high-probability setups, quality over quantity

7. No Risk Management

❌ Wrong: Risking 50% of account on one trade ✅ Right: Risk 1-2% per trade maximum

Risk Management Checklist

Before every trade, verify:

Example Trade Walkthrough

Let's walk through a complete example trade:

Setup:

  • Account: $1,000 in Drift account

  • Market: SOL-PERP at $150

  • Thesis: Expecting move to $165 (10% up)

  • Risk: 2% of account = $20 maximum loss

Planning:

  • Direction: Long

  • Entry: $150 (market order)

  • Stop-Loss: $145 (3.3% below = $5 per $150 position)

  • Take-Profit: $165 (10% above)

  • Position Size: $400 (5% move = $20 loss)

  • Leverage: 2.5x (to get $400 position with $160 margin)

Execution:

  1. Open DEX, select SOL-PERP

  2. Click "Long"

  3. Set Market order

  4. Enter $400 position size

  5. Set leverage to 2.5x

  6. Set stop-loss at $145

  7. Set take-profit at $165

  8. Review: Liquidation at $125 (very safe)

  9. Click "Open Long" → Confirm

Outcome Scenario 1: Win

  • Price rises to $165

  • Take-profit triggers automatically

  • Position closes: +10% = $40 profit

  • ROI: $40 profit / $160 margin = 25% return

Outcome Scenario 2: Loss

  • Price drops to $145

  • Stop-loss triggers automatically

  • Position closes: -3.3% = $20 loss

  • ROI: -$20 loss / $160 margin = -12.5% return

Result:

  • Risk/Reward Ratio: 1:2 (risking $20 to make $40)

  • Account risk: 2% maximum

  • Even with loss, still have $980 to trade again

Advanced Tips

Once you're comfortable with basics:

1. Scale Into Positions

  • Don't enter full size at once

  • Add 25% at a time as trade confirms

  • Average entry price while managing risk

2. Trail Your Stop-Loss

  • Move stop-loss as profit increases

  • Lock in gains while staying in trend

  • Protects from giving back profits

3. Watch Funding Rates

  • High positive rate → expensive to hold longs

  • High negative rate → expensive to hold shorts

  • Consider closing before funding payment if very high

4. Use Market Structure

  • Enter near support (longs) or resistance (shorts)

  • Allows tighter stops

  • Improves risk/reward

5. Correlation Trading

  • Watch Bitcoin for overall market direction

  • SOL often follows BTC trends

  • Consider BTC when trading SOL-PERP

Additional Resources

Key Takeaway: Start small, use low leverage, always have a stop-loss, and only risk 1-2% per trade. Master these basics before increasing size or leverage. Consistency and survival are more important than hitting home runs.

Ready to start? Head to the DEX and practice with small positions!

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