> ## Documentation Index
> Fetch the complete documentation index at: https://docs.ultramarkets.xyz/llms.txt
> Use this file to discover all available pages before exploring further.

# FAQ

> Frequently asked questions about Ultramarkets.

## For Traders

<AccordionGroup>
  <Accordion title="Can I hold a position through resolution?">
    No. All positions close before the event resolves. You're trading probability movements, not betting on outcomes.
  </Accordion>

  <Accordion title="What happens if I forget to close my position?">
    Nothing bad. Positions auto-close at the market's close date. You don't need to take any action.
  </Accordion>

  <Accordion title="Why was I liquidated?">
    Your position health dropped to 45%. This happens when the market moves against you significantly. Higher leverage means faster liquidation.
  </Accordion>

  <Accordion title="What's the difference between Phase 1 and Phase 2 liquidation?">
    **Phase 1** (direct liquidation) is used for smaller positions—we sell immediately on Polymarket. **Phase 2** (Dutch auction) is used for larger positions to avoid market impact. In Phase 2, liquidators bid to buy your position at a discount, and the shares transfer directly to them without touching Polymarket order books.
  </Accordion>

  <Accordion title="What happens to my position in a Dutch auction?">
    Your shares are auctioned to a liquidator who pays for them. The vault recovers its capital, and any discount comes from your remaining margin. The liquidator receives your position (including its original close date).
  </Accordion>

  <Accordion title="Can I add margin to avoid liquidation?">
    Not currently. If a position is approaching liquidation, your options are to close it manually or let it liquidate.
  </Accordion>

  <Accordion title="What's the minimum position size?">
    \$10 margin minimum. With 10x leverage, that's a \$100 position.
  </Accordion>

  <Accordion title="Are there trading fees?">
    Yes. Market orders charge 0.5% of your margin at open. Limit orders charge 1.5% of your margin at order creation. No fee to close. If you profit, 10% of profit goes to LPs.
  </Accordion>

  <Accordion title="What happens if my limit order only partially fills?">
    A position is created from the filled portion. It's fully tradeable: you can close it or let it run. The unfilled capital (proportional margin + borrowed + fee) is refunded when the order is cancelled or expires.
  </Accordion>

  <Accordion title="Can I cancel a limit order?">
    Yes. Unfilled capital is refunded proportionally. The filled portion remains as a normal open position.
  </Accordion>

  <Accordion title="Why is the limit order fee higher than market orders?">
    Limit orders require capital to be locked while waiting for fills and involve more operational complexity: CLOB placement, partial fill tracking, and proportional refunds.
  </Accordion>

  <Accordion title="What price do I get with partial fills?">
    Your position's entry price is the weighted average across all fills. For example, if 60% fills at \$0.65 and 40% fills at \$0.63, your entry price is approximately \$0.642.
  </Accordion>
</AccordionGroup>

## For LPs

<AccordionGroup>
  <Accordion title="When can I withdraw?">
    Anytime there's available liquidity in the vault. If utilization is high, you may need to wait for positions to close.
  </Accordion>

  <Accordion title="What if I need to exit immediately during high utilization?">
    You can sell umUSD on the secondary market (AMM pools) for instant liquidity, though you may receive slightly less than NAV.
  </Accordion>

  <Accordion title="How is yield calculated?">
    Yield comes from trading fees (0.5–1.5% of margin) and profit sharing (10% of trader profits). It accrues as NAV appreciation, not as distributions.
  </Accordion>

  <Accordion title="What's the time-weighted multiplier?">
    Longer deposits earn proportionally more. 0-30 days = 1.0x, 30-60 days = 1.1x, 60-90 days = 1.2x, 90+ days = 1.3x.
  </Accordion>

  <Accordion title="Can the vault lose money?">
    Yes, if bad debt occurs from failed liquidations. The USM (coming with token launch) provides first-loss protection.
  </Accordion>
</AccordionGroup>

## Technical

<AccordionGroup>
  <Accordion title="What blockchain is Ultramarkets on?">
    Polygon (Ethereum L2). Deposits and withdrawals are in USDC on Polygon.
  </Accordion>

  <Accordion title="Is umUSD an ERC-4626 token?">
    Yes. It's a standard tokenized vault, compatible with DeFi protocols that support ERC-4626.
  </Accordion>

  <Accordion title="Where are positions actually held?">
    On Polymarket, in a **trader-specific Polymarket account** that we create for you under the hood.

    * **Traders custody their own shares.** When you open a position on Ultramarkets, we execute a real trade on Polymarket *into your Polymarket account*, and the resulting outcome tokens are held there.
    * **Ultramarkets is not the custodian of your Polymarket positions.** We provide the margin, leverage, execution, and risk management layer, but the underlying shares live in your Polymarket account.
    * **Key access:** You can export the private keys for that Polymarket account **after all positions have been settled**.
  </Accordion>

  <Accordion title="Does using Ultramarkets expose me to Polymarket?">
    Yes. Because the underlying trades are real Polymarket positions, traders (and LPs indirectly through execution) are exposed to Polymarket venue risks like downtime, liquidity issues, or resolution disputes. Ultramarkets reduces *gap risk* by force-closing positions before resolution, but it cannot remove Polymarket venue dependency.
  </Accordion>

  <Accordion title="Are trades done from one shared Polymarket account?">
    No. Trades are executed into **your own Polymarket account** (per trader). We create this account for you automatically when you start trading. You do not need to manually find or set up a separate execution account.
  </Accordion>

  <Accordion title="Can I see which Polymarket account a trade was executed on?">
    Yes. The trade is executed into your own Polymarket account, and your Ultramarkets dashboard is the primary interface for monitoring the position during its lifecycle.
  </Accordion>

  <Accordion title="What happens if Polymarket goes down?">
    We cannot open new positions or close existing ones until Polymarket is operational. This is a dependency risk.
  </Accordion>
</AccordionGroup>