Isolated and cross margin

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2021-06-01 00:00:00

What is isolated margin?

In isolated margin mode, the position margin is a fixed value and initially set as the initial margin. Users can adjust the margin to change the amount of margin afterwards. When the margin balance falls below the stop loss level, a forced liquidation will be triggered.

If the user's position is forcibly liquidated due to price fluctuations, only the margin amount of the corresponding position will be lost, and it will not affect other funds in the contract account.

What is cross margin?

In cross margin mode, the entire balance of the user's account is used as position margin. Users can set cross margin mode for positions in multi futures, and all positions set in cross margin mode can share the account balance as margin.

In cross margin mode, whether a position will be forcibly liquidated depends on the margin ratio. The system will notify the user through an internal message, email, or SMS when the margin ratio reaches 20%, advising the user to be cautious about their positions to be forced liquidated*. When the margin ratio reaches 10%, the system will initiate forced liquidation in descending order based on the loss ratio. If the loss ratio is the same, positions with higher margin will be liquidated first.

  • *Note:
  • 1. Email and SMS notifications may experience delays or may not be received by users in time due to network delays or force majeure.
  • 2. Forced liquidation in cross margin mode will incur liquidation fees, which will be deducted from the account balance and stored in a separate fund account specifically designed to cover the excessive losses incurred by users.
  • What is margin ratio?

    The margin ratio is the criterion used in cross margin mode to determine whether a user's position needs to be forcibly liquidated.

    The calculation formula is: (Account equity - Isolated margin net P/L- Isolated opening margin)/(Total positions’ frozen margin - Isolated opening margin) * 100%.

    What is account equity?

    Account equity is the net assets of a user’s futures account.

    The calculation formula is: User's assets + Isolated margin net P/L + Cross margin net P/L.