> For the complete documentation index, see [llms.txt](https://docs.carbon.inc/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.carbon.inc/trading/trading-faq.md).

# Trading FAQ

<details>

<summary>What are perpetual contracts, and how do they work on Carbon?</summary>

Perpetual contracts are futures contracts without an expiration date, allowing you to hold positions indefinitely. On Carbon, they're powered by a solver network that provides competitive pricing.

</details>

<details>

<summary>How is margin handled when trading perpetuals on Carbon?</summary>

Carbon uses cross-margin, where your entire account balance is used as collateral for all positions. This means your entire account is at risk of liquidation.

</details>

<details>

<summary>What fees can I expect when trading on Carbon?</summary>

Currently, fees on Carbon are zero for a limited time only.

</details>

<details>

<summary>How do liquidations work?</summary>

Your account will be liquidated if your Equity Balance drops below the Maintenance Margin (CVA). Because Carbon uses cross-margin, all assets and positions in your account will be liquidated. [Read more here](/trading/liquidations-cva-and-account-health.md)

</details>

<details>

<summary>What does it mean when there's "No Liquidity Available?"</summary>

This means all available open interest from the solver is currently being used. Liquidity will increase as trades close, liquidations occur, or the solver adds more collateral.

</details>

<details>

<summary>What is Open Interest (OI) on Carbon?</summary>

OI represents the total notional value of all open long and short positions on the platform. You can find the current OI in the trading UI. OI is different for each pair.

</details>

<details>

<summary>Why can't I close my position if my uPNL is positive?</summary>

This can occur if the slippage required to close the position could trigger a liquidation. Adjust your slippage settings or close the position in smaller increments.

</details>

<details>

<summary>Why was my trade request rejected?</summary>

Counterparties can reject trades at their discretion, for example, if the price has changed significantly since the quote was streamed. Simply re-enter the trade to try again.

</details>

<details>

<summary>What is Credit Valuation Adjustment (CVA), and how does it affect my trading?</summary>

CVA is the Maintenance Margin needed to keep your account solvent. Your Equity Balance must be higher than your CVA to avoid liquidation.

</details>

<details>

<summary>Why is the CVA higher when I use higher leverage?</summary>

Carbon doesn't have an insurance fund to cover losses, so higher CVA is required with higher leverage to ensure all counterparties are made whole in the event of a liquidation.

</details>

<details>

<summary>What assets can I use as collateral on Carbon?</summary>

Currently, only USDC can be used as collateral on Carbon.

</details>

<details>

<summary>What are funding rates, and how do they work?</summary>

Depending on the underlying contract skew, you'll either pay or receive funding fees. If the funding rate is positive, long pay shorts. If the funding rate is negative, shorts pay longs. You can view the current funding rate in the trading UI.

</details>

<details>

<summary>Can I use Stop Loss and Take Profit orders?</summary>

Yes, [Stop Loss and Take Profit](/trading/take-profit-and-stop-loss.md) orders are available on Carbon.

</details>

<details>

<summary>Why is the liquidation price an estimate?</summary>

Because Carbon uses cross-margin, the liquidation price is based on the current margin in your account, which fluctuates dynamically. The estimated price will change along with your account's margin.

</details>

<details>

<summary>What is the spread, and how does it affect my trades?</summary>

The spread is the difference between an asset's buying and selling price. You can view the current counterparty spread in the trading UI. The different counterparties set spreads and are subject to change.

</details>


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