How Does the Absence of an Expiration Date Affect a Trader’s Margin Requirements?

The absence of an expiration date means that positions can be held indefinitely, increasing the potential for sustained price movements against the trader. This necessitates robust margin requirements to cover potential losses and prevent cascading liquidations.

Perpetual futures often require higher maintenance margin compared to traditional futures nearing expiration to ensure market stability and solvency over an indefinite period.