Fees and Costs

To provide users with a clear understanding of the fees and costs incurred when trading Long/Short Options on the Alpha Market, we have compiled the applicable rules below. This doc covers Transaction Fees, Option Financing Costs, and Trading Execution Losses.

Option Trading Fees and Costs

1. Option Opening and Closing Fees (Transaction Fees)

Trading Action	Fee Description	Notes
Buy / Sell Options	Fee Waived during the Alpha Market Boosting Program	Includes opening and closing Long / Short positions (when not exercised).

Note: The Alpha Market Boosting Program runs from 2025 November 27th 00:00:00 UTC - December 3rd 23:59:59 UTC. After the program concludes, transaction fees will be calculated as a percentage of the Notional Value. Please refer to the official announcement for specific rates.

1. Exercise Fee (Take Profit Fee)

When an option position is profitable (i.e., reaches the exercisable range), users can realize gains by clicking “Take Profit” to close the position. A fee is charged on the current Notional Value at the time of exercise.

• Initial Fee Rate: 1.9% (on Day 1 of the contract)

• The fee linearly decreases as the contract approaches maturity

Fee Calculation: Fee = Option Notional Value × Daily Rate Daily Rate = 1.9% × (Remaining Term / Total Contract Days)

Example: Assume you purchase a 14-day option contract and close the position on Day 10. If the option's Notional Value is 10,000 USDT at that time, with 4 days remaining, the fee you pay is: 10,000 × 1.9% × (4/14) ≈ 54.3 USDT

1. Option Financing Cost (Interest Cost)

When purchasing an option, the user must pay a borrowing interest based on the option's Notional Value, calculated as follows:

Interest = Option Notional Value × AMM Rate Pricing × Holding Days / 365

This interest is collected by the Dual Investment Depositors (LPs), who effectively act as option sellers and provide trading liquidity to the option buyer. The platform may deduct a certain percentage as a commission from this interest (currently 10%).

Note on Calculation Precision: Although the formula uses the 'day' unit for conceptual clarity, the system performs calculation and accrual in real-time on-chain, measured per second (i.e. per block).Therefore, the system converts the AMM Annualized Rate into a per-second rate and calculates the interest expense based on the precise number of seconds held.

Example: Assume you purchase an option with an 100% Annualized Rate, a Notional Value of 100 USDT, and hold it for 1 day. The interest cost is calculated as: 100 × 100% × 1 / 365 ≈ 1.37 USDT

Please Note:

• The Annual Rate adjusts dynamically based on AMM pricing.

• Interest accrues linearly with the holding period.

For more details on the Alpha Market, please visit https://docs.ts.finance/protocol-mechanisms/alpha-market For TermMax AMM mechanism details, please refer to https://docs.ts.finance/strategies/borrow-lend-strategies

Trading Execution Losses (Execution Costs)

These are objectively existing market costs, primarily determined by market volatility and asset liquidity.

Loss Type	Description	Bearer
Slippage	The difference between the expected execution price and the actual executed price (can be positive or negative).	The Trader
Bid-Ask Spread	The difference between the highest bid and lowest ask price. (The Alpha Market has almost negligible spread, which users can largely disregard).	The Trader

User Trading Fees and Cost Summary

Users trading on the Alpha Market may incur the following costs:

• Option Transaction Fees (fee-free during the alpha boosting program)

• Take Profit Fee

• Option Financing Cost

• Trading Execution Losses (Slippage, Spread)