Perpetuals have become a bigger discussion topic of late. Here are some of the questions we’ve been answering.
Perpetuals are more flexible than stock option trades because the traders don’t have to worry about exercise and never face a deadline to close out their contracts. Are the main advantages that they’re cheaper because the traders save on rollover costs? Are stock option trades the closest equivalent for an individual investor?
Perpetuals provide delta-one exposure to stocks, similar to ETFs. A benefit of perpetuals over stock/ETF ownership is that a trader can go long or short without having to worry about covering the short sales. Perpetuals can be traded on leverage, and traders can choose the leverage that makes sense for them (up to a maximum of about 6.45x for stock futures). As with any leveraged position, losses on a long or short perpetual can exceed the initial margin.
Stock options are a familiar comparison for retail investors seeking leveraged exposure, but they're economically quite different. Options have nonlinear payoffs, time decay, and are much more complex for retail customers.
In summary, the principal advantages for perpetuals are simplicity, flexibility, and ease of accessing both long and short exposure.
Going short is as operationally simple as going long.
They are simpler than options (no need to manage strikes, Greeks, exercise/assignments or time decay).
They avoid rollover fees - instead, traders pay or receive periodic funding payments depending on market movements.
They provide for capital efficiencies (traders post margins, not full notional).
Is it true that traders frequently jump in and out of perpetual contracts as the price fluctuates which makes them lucrative for platforms? Which is the most promising product for Kalshi? Perps on stock or on cryptocurrencies?
Perpetual futures attract active traders, but that's not unique to these products. The same is true of equity options, particularly zero-days-to-expiration options (0DTE), and many traditional futures markets. For example, CME E-mini futures open interest (OI) is primarily concentrated in the front month and users roll their positions frequently, generating significant transaction fees for the exchange.
Single stock perpetuals have been our most in-demand perpetual type for our users for their trading and risk management needs. Kalshi is already at $5B in notional trading volume after launching Nov. 5, 2026.
Is there any real difference between the amount a trader can leverage a stock perpetual on Kalshi and the amount of leverage baked into stock options?
Both perpetuals and stock options are derivative instruments traded with leverage on federally regulated exchanges.
With a perpetual future, leverage is simple, explicit and transparent. Traders know their notional exposure and the margin required to maintain their positions. Kalshi's stock-perpetual margin framework establishes a minimum customer margin requirement of 15.5% of notional exposure, with higher requirements imposed where appropriate based on risk.
Stock options can provide much higher leverage, depending on the strike, expiry, and the sensitivity to the underlying. Their leverage isn’t fixed and can change drastically as market conditions evolve, making it more complex for retail traders.
How often does Kalshi rebalance perpetual trades for stocks, crypto and other assets? Daily?
There is no requirement for traders to rebalance their positions daily. They can maintain positions as long as they satisfy applicable margin requirements and the contracts remain listed.
Kalshi monitors positions and margin exposure on a real-time basis throughout the trading day for risk management purposes. Our clearinghouse, Kalshi Klear, currently runs two scheduled daily settlement cycles, approximately at noon and 4 p.m. ET, during which gains and losses are settled.
In addition, Kalshi computes funding cost adjustments once daily at 4 p.m. ET for single stock perpetuals, indexes and metals perpetuals. This helps keep perpetual prices aligned to underlying stock prices. For crypto perpetuals, funding costs are computed more frequently, three times daily, given that the underlying market trades 24/7.
Does Kalshi claim that perpetuals are no riskier than other trades it offers?
Perpetuals have a different risk profile from our event contracts, just as traditional futures and options have different risk profiles from each other. While a perpetual may require funding payments beyond initial margin (and subsequent market movements may lead to liquidation), the value does not turn on a binary outcome. So it’s not quite right to say that one is less or more risky than the other - the structures are just different.
Our responsibility as a regulated exchange is to provide a transparent trading environment with appropriate risk safeguards (margins, default fund), real-time risk monitoring, default management protections, customer disclosures, and other market safeguards. For single stock futures there is also a maximum leverage of approximately 6.45x for end customers, which is lower than leverage offered by large regulated exchanges on other futures and options products.
Regarding the critiques of perps, the CFTC is the principal regulator. Kalshi is notice-registered with the SEC but that doesn't offer the same set of investor protections as those that apply to non-perpetual trades. The SEC can bring an enforcement action if it detects misconduct after the fact but the products don't trade on SEC-examined platforms and aren't subject to SEC trading rules and surveillance. Isn't this less protection for Kalshi customers?
No. Kalshi customers trading perpetual contracts get a full regulatory regime, not a reduced one.
Congress designed this structure in the Commodity Futures Modernization Act. That law created a joint CFTC–SEC framework for security futures. CFTC-regulated exchanges that list security futures notice-register with the SEC, and Congress exempted them from many duplicative SEC requirements while preserving core securities-law protections. Notice registration is the outcome of that design, not a gap in it.
The SEC also keeps meaningful authority. Security futures are securities under federal securities law, so the SEC’s antifraud and insider-trading rules apply to these products, and the SEC can investigate and bring enforcement actions.
The question isn’t whether one agency or two examine the platform. It’s whether customers are protected by strong rules, active surveillance, and real enforcement. Under the joint CFTC-SEC framework, they are.
Broker-dealers for stocks must be registered, which produces an audit trail for the SEC. Is Kalshi using an FCM? Is it affiliated with Kalshi and if so how? Is there a regulation that specifies that the FCM not be affiliated with Kalshi?
Yes. Kalshi uses its own futures commission merchant (FCM), Kalshi Prime.
No. There isn’t a regulation that requires the FCM to be unaffiliated with Kalshi.
Critics say that Kalshi is introducing price volatility and other risks that could bleed into the stock market. Response?
We strongly disagree with the assertion that a single-stock perpetual traded on a regulated exchange has a negative effect on the stock market. Derivatives markets have existed alongside the stock market for decades. Options, futures, and other derivatives support price discovery, hedging, and other risk management tools.
Kalshi's stock perpetuals are cash-settled, with limited leverage and do not require the delivery of shares. They are subject to stringent collateral requirements, position limits, market surveillance, trading safeguards, and coordinated oversight with the underlying securities markets.
We recognize that derivatives and underlying markets are economically connected, including through hedging activity, which is why robust market-integrity controls and cross-market surveillance matter. The relevant distinction is between offshore, unregulated products and perpetual futures traded on a U.S.-regulated exchange with centralized clearing and enforceable risk controls.
