What is Liquidation Price?

The liquidation price is the price at which forced liquidation will be triggered.

When the mark price of a contract falls below the liquidation price (for long positions) or rises above the liquidation price (for short positions), the risk ratio will drop to 0%, and the forced liquidation process will be triggered.

Liquidation Price Calculation

1. Isolated Margin Mode

• Long Liquidation Price = [Long Position Qty × (Long Maintenance Margin Rate + 1)] / (Long Position Allocated  Margin + Long Position Opening Value)
• Short Liquidation Price = [Short Position Qty × (Short Maintenance Margin Rate − 1)] / (Short Position Allocated Margin − Short Position Opening Value)
  • Position Value = Position Qty / Average Entry Price
  • Allocated Margin = Initial Margin + Added Margin − Reduced Margin

2. Cross Margin Mode

• Cross Position Liquidation Price = (Asset Long Position Qty − Asset Short Position Qty + Asset Qty × Maintenance Margin Rate) / (Cross Position Margin − Cross Maintenance Margin + Asset Qty / Mark Price × Maintenance Margin Rate + Asset Long Position Qty − Asset Short Position Qty)

3. Notes

• For Maintenance Margin Rate, please refer to Leverage and Margin Explanation for Coin-Margined Contracts.
• Contracts of different currencies are calculated independently.

When is the Liquidation Price Recalculated?

The liquidation price will be recalculated when any of the following actions occur:

• Cross Margin Mode: Adding a position, closing a position, adjusting leverage, or placing a new open order (as it reduces available balance).
• Isolated Margin Mode: Adding a position, closing a position, adding margin, reducing margin, or adjusting leverage.

Notes:

• If funding fee deductions reduce the margin balance, the liquidation price will change accordingly.
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• Under Isolated Margin mode, placing new limit opening orders does not affect the liquidation price calculation (frozen margin for pending orders with isolated margin is not included in the liquidation price calculation).

🔗 Explore More: What is Forced Liquidation >>