What is margin?
Margin is the cash that keeps a perp position open. There are two key figures:
Initial margin: The cash you commit to open the position. A full health bar represents this amount.
Maintenance margin: Minimum required to keep the position open. If your margin reaches this level, the position is closed automatically.
What is margin balance?
Your margin balance is the cash held for your position, plus or minus any unrealized profit or loss. It determines whether your position stays open.
Four things move margin balance:
Price moves: An adverse move reduces it; a favorable move increases it
Funding payments: Paid or received three times a day. See the Funding Payments Section for details.
Adding margin: Increases it without changing your position size
Adding to the position: Increases both the margin balance and the position size
Does margin carry across positions?
No, every position has its own margin. Positions do not share it, and a loss on one doesn’t draw from another.
If one of your positions is manually closed or liquidated, the others are unaffected. Adding margin also helps only the position you add it to.
What does the health bar mean?
Each position shows a health bar that reflects how much margin remains between your current balance and the maintenance margin.
Healthy: Your margin balance is at or near where you started. Nothing needs attention.
Cautious: Your margin balance has fallen enough that the position needs watching. A Position at risk of liquidation banner appears.
Dangerous: Your margin balance is close to the maintenance margin. The position is at real risk of being closed.
Example:
You hold a $300 position with a $100 margin at 3x leverage. The maintenance margin is $45.
Bar starts full at $100 at Healthy
Below about $90, the position moves into Cautious
Below about $68, it becomes Dangerous
At $45, the position is closed
Here, an 18% adverse price move would use up the $55 between your starting and maintenance margins, closing the position.
What happens when a position nears liquidation?
When your margin balance falls to the Cautious level:
The position shows a Position at risk of liquidation banner with available actions
You’re restricted from adding to the position or increasing exposure while in this state
Adding margin and closing remain available, because both reduce risk.
Higher leverage means less room between your starting and maintenance margins, so a smaller price move can bring you closer to liquidation.
How does liquidation work?
When your margin balance reaches the maintenance margin, the position is closed automatically at the market price available at that time. This is not reversible, and a liquidation fee applies.
Any remaining margin, minus the fee, returns to your cash balance.
How can I reduce liquidation risk?
Add margin: Moves the liquidation price further away without increasing your position size. Available at any time.
Set stop-loss: Automatically closes the position at a price you choose, before liquidation. See the Take-Profit and Stop-Loss (TP/SL) Section for details.
Close the position: Ends the exposure and returns remaining margin to your balance
Use less leverage: The lower the leverage, the more room between your starting and maintenance margins
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