# Perp Fees & Risk Parameters

## Trading Fees

Fees: 0.01%\
\
Opening Fee = Position Size × Leverage × 0.01%
\
Closing Fee = Position Size × Leverage × 0.01%

* Both fees are charged once on open and once on close.
* OG/VIP users receive real-time rebates. (Read more [DeriW OG Program](/community/deriw-og-program.md)).

#### Real-Time VIP Fee Rebate Table (OG)

| DER Points Held | VIP Level | Fee Rebate |
| --------------- | --------- | ---------- |
| ≥ 5,000 DER     | VIP 2     | 20%        |
| ≥ 400 DER       | VIP 1     | 10%        |

Rebates are applied instantly upon trade execution. 

## Funding Rate

The funding rate is used to balance the long and short positions on the platform, protecting ALPs from excessive risk exposure during trading and minimizing the holding risk of the pool. 

**Calculation formula:** 

```
Funding Rate = (Net Floating PnL of Longs or Shorts) ÷ (Total Funds in Long + Short Pool) × 0.01
```

* If both sides show positive PnL, both long & short pay funding.
* Funding Fee = Position Size × Funding Rate

If both sides are positive, both long and short positions will be charged the funding rate. The funding fee that users need to pay = the position amount held \* funding rate This fee is charged every 60 minutes.

## Liquidation

The liquidation price is defined as the price at which the token price exceeds or falls below the average price by a certain range—that is, when the loss plus transaction fees equals a certain percentage of the margin. It is calculated as follows: when (collateral - loss - Toatl fees) falls below a certain percentage of the position size, the price is set as the liquidation price. This percentage ranges from 0.5% to 1.5%, depending on market conditions and pool settings. If the token price falls below this point, the position will be automatically liquidated.

Total Fees: opening/closing fees, funding fees. 

Leverage is the leverage multiplier chosen by the user.

## Slippage (PendulumAMM Mechanism)

Only applied when **net long or short imbalance exceeds 70% of the liquidity pool capacity**.

**Formulas:**

Long Slippage = (User Long + (Net Long−Short − 70% of pool)) ÷ Total Long × 0.02\
Short Slippage = (User Short + (Net Short−Long − 70% of pool)) ÷ Total Short × 0.02

Net position difference between long and short positions = Total amount of long positions - Total amount of short positions or Net position difference between long and short positions = Total amount of short positions - Total amount of long positions

Opening slippage is only charged when the "net position difference between long and short positions" is greater than 0.

### **Liquidity Pool Slippage Mechanism**

When the market becomes heavily one-sided beyond the liquidity pool’s capacity, the system will automatically apply slight slippage to newly opened positions in that direction in order to protect overall fair trading. This mechanism only triggers when necessary for risk control.

***

### **1. Under what conditions will slippage occur?**

Slippage is triggered when the market shows extreme one-sided positioning and the exposure exceeds what the liquidity pool can support. In this case, newly opened orders in that direction will incur slippage.

#### **Example:**

Current positions:

* **Total Long Positions:** 1000 USDT
* **Total Short Positions:** 700 USDT

Therefore:

**Net Long Difference = 1000 – 700 = 300 USDT**

If the current liquidity pool amount is **280 USDT**, the pool is no longer sufficient to cover the 300 USDT long exposure:

✅ Opening **new long positions** will trigger slippage\
✅ Opening **short positions** will **NOT** be affected

***

### **2. How is slippage calculated?**

The platform uses a dynamic calculation model. The slippage percentage is related to:

* The user’s position size for this order
* Current long/short net exposure
* Liquidity pool balance
* Total market position size in that direction

#### **Formula**

**Long Position Slippage:**

(User Long Size+(Net Long Difference−Liquidity Pool Total×70%))÷Total Long Position Size×2%

**Short Position Slippage:**

(User Short Size+(Net Short Difference−Liquidity Pool Total×70%))÷Total Short Position Size×2%

***

### **3. Important Notes**

✅ Slippage only occurs when exposure in one direction exceeds the pool’s capacity\
✅ Slippage is a **risk-protection mechanism**, not an extra platform fee\
✅ Slippage will automatically disappear once the market returns to balance\
✅ The exact slippage level adjusts in real-time with market conditions


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