Skip to main content

Margin and liquidation

How margin works, when a position is liquidated, and the warnings the app gives you first.

Margin​

Every perpetual position needs margin, which is collateral from your balance.

  • Initial margin is what you need to open a position. At a given leverage it is roughly the position value divided by the leverage; the order form's Required Margin shows this plus the opening fee.
  • Maintenance margin is the minimum your account must keep to hold the position open.

The order form's account block shows your live figures: Unrealized PNL, Cross Margin Ratio, Maintenance Margin and Cross Account Leverage.

  • Cross margin: your whole balance, including unrealised PnL, supports all cross positions.
  • Isolated margin: only the margin assigned to that position supports it.

Liquidation​

If losses bring your equity down to the maintenance margin, positions are liquidated: closed automatically, with a liquidation fee. The Liquidation Price column shows where that would happen. Cross positions show an estimate, because the whole account's balance and positions matter.

Cross positions are checked together against your cross balance; an isolated position is checked against its own margin and liquidated on its own.

While the account is being liquidated, open orders are cancelled, trading and withdrawals are disabled, and a liquidation fee is charged.

Warnings before liquidation​

  • Banner: when your account is 90% or more of the way to liquidation, a banner appears on every page with an Add margin button, which opens Deposit. It hides again below 85%. If the tab is in the background, the browser tab title flashes a warning.
  • Notifications: while the app is open, you get a Liquidation Risk notification when your account crosses 50%, 75%, 80% and 90% of the way to liquidation. Liquidation notifications cannot be muted.
  • After a liquidation: you get a Liquidations Completed notification for each liquidated position, with that position's liquidation fee. The trades show as Liquidated in history.

"Percent of the way to liquidation" is your maintenance margin divided by your equity. At 100% the account can be liquidated.

Example: equity $1,000 and maintenance margin $450 is 45%. If losses cut equity to $500, that's 90% and the banner appears. At $450 (100%) the account can be liquidated.

How to stay safe​

  • Use lower leverage on isolated positions (more margin backs the position, so its liquidation price is further away), and keep cross positions small relative to your balance.
  • Deposit more (cross margin) or reduce positions when a warning appears.
  • Set a stop loss so the position closes before it reaches liquidation.
  • Watch funding: it accrues continuously on open positions.