Margin, margin ratio and liquidation

This article explains how your futures positions are protected by margin, when a position is liquidated, and how to add or remove margin on an isolated position.

Key words

• Margin: the collateral held for a position. "The collateral allocated to this position. In isolated mode, this is the specific margin assigned. In cross mode, it shares the account balance."
• Maintenance Margin: "The minimum margin required to keep your positions open. If margin balance falls below this, liquidation will occur."
• Margin Balance: "Total equity in your futures account, including unrealized PnL. Used to calculate your margin ratio."
• Available Balance: "Funds available to open new positions or withdraw. Margin balance minus margin used by current positions."
• Margin Ratio: "Maintenance Margin / Margin Balance x 100%. When margin ratio reaches 100%, your position will be liquidated."
• Liquidation: your position is closed automatically by the exchange because your margin can no longer cover the losses.
• Liq. Price: "Liquidation Price. The estimated price at which your position is automatically closed to prevent further losses beyond your margin."

You can see Margin Ratio, Maintenance Margin, Margin Balance, Available Balance and Unrealized PnL in the Account box on the futures trading page, and a ratio, margin and liquidation price on each row of the Positions tab (see How to read your open positions).

Cross and Isolated margin

The margin mode is chosen on the order form ("Perpetual Margin Mode").

• Cross: "All cross positions under the same margin asset share the same cross margin balance. In the event of liquidation, your full margin balance along with any remaining open positions under the asset may be forfeited." Your whole futures balance supports the position, so it is harder to liquidate but a loss can reach your full balance.
• Isolated: "Manage risk on individual positions by restricting the margin allocated to each. If the margin ratio reaches 100%, the position will be liquidated. Margin can be added or removed using this mode." Only the margin assigned to that position is at risk.

You cannot switch while you hold risk on the pair: "Margin mode cannot be changed while you have an open order or position." After a change you see "Margin Mode Changed", or "Failed to change margin mode". For a leverage change you see "Leverage Changed" / "Leverage has been set to the number shown x" or "Failed to change leverage". If the system is slow: "This is taking longer than usual. We'll update your settings when it's done." While a voucher position is open: "Leverage and margin mode are locked while a voucher position is open."

Higher leverage means a liquidation price closer to your entry price: "Selecting higher leverage such as [the leverage you chose] increases your liquidation risk. Always manage your risk levels."

Margin ratio levels in the app

For Cross positions the ratio is for the whole account. For Isolated positions it is for that single position (maintenance margin divided by the position's margin plus its unrealized PnL).

What happens at liquidation

1. As the market moves against you, your margin ratio rises.
2. You may see pop-up notices: Margin Call, then Liquidation Warning.
3. If the ratio reaches 100%, you see Position Liquidated (or Position Partially Liquidated when only part of the position is closed).
4. The position appears in Position History with the status Liquidated (see Position and transaction history). In Transaction History you may see entries of type Liquidation Fee or Insurance Clear.
5. For an Isolated position, you can lose the full margin assigned to it. For a Cross position you can lose your full margin balance. Risk page: "If your margin falls below the maintenance requirement, your position can be liquidated automatically and you can lose the full margin allocated to it."

The app's Responsible Trading page also describes an insurance fund and an auto-deleverage (ADL) process: "The primary purpose of an insurance fund is to limit the occurrences of auto-deleverage liquidations (ADLs)", and the ADL indicator "shows your position in the auto-deleverage queue. If all lights are lit, in the event of a liquidation, your position may be reduced." See Responsible trading.

How to reduce liquidation risk (tools in the app)

• Add margin to an isolated position (below).
• Close part or all of the position (How to close a position).
• Deposit or transfer more USDT into your futures wallet (the Account box has a Transfer button).
• Set a stop loss (TP/SL guide), keeping in mind the warning: "In a rapidly changing market, setting a stop-loss trigger close to the liquidation price may result in the order failing to execute."

Add or remove margin (isolated positions only)

The pencil icon next to the margin amount appears only for Isolated positions.

1. In the Positions tab click the pencil next to Margin (tooltip Add Margin).
2. Choose the tab Add Margin or Remove Margin.
3. Enter an Amount (USDT) (two decimals) or press MAX.
4. Check the window: Currently Assigned Margin, Max addable / Max removable (the line under the box reads "Max Available" or "Max removable" with the amount), and Est. Liq. Price after increase or Est. Liq. Price after reduction.
5. Press Confirm. Success: Margin Added or Margin Removed, "the amount USDT has been adjusted for the contract".

Rules:

• Add: the most you can add is your Available Balance. Message: "Amount exceeds available balance".
• Remove: you can only take out margin above what the position needs, taking its unrealized PnL into account. Message: "Amount exceeds max removable". If nothing can be removed, the max shows 0.00.
• "Invalid amount": the amount is empty, zero or not a number.
• Voucher positions: "Voucher margin can't be removed" / "The voucher part of the margin can't be removed."
• Other errors appear with a reason from the exchange.

FAQ

Why was my position liquidated although the price never hit my Liq. Price? The app labels it "The estimated price". The mark price (not the last traded price) is used for liquidation calculations, and in Cross mode your other positions and balance also count. Check the mark price on the Positions tab.

Can I get my margin back after liquidation? The app does not state any refund or compensation. If you think the liquidation was wrong, contact Support with the details below.

Where do I see how much I lost? Position History shows realized PnL; Transaction History shows Realized PnL, Funding Fee and Liquidation Fee entries.

When to contact Support

Send: the contract, side, size, entry price, the time of the liquidation or margin change, Cross or Isolated, the amounts you tried, screenshots of the message, the position row, and the Position History or Transaction History entry.

Safety reminder

Leverage can wipe out your margin quickly. Only trade with money you can afford to lose. Never share your password, 2FA code, seed phrase or private key.

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