Risk Ratio is a metric for evaluating how safe a futures position is relative to its liquidation trigger condition.
It reflects the proportion of risk buffer remaining in the position margin relative to the position value after deducting the maintenance margin.
- ⚠️ The lower the Risk Ratio, the closer the position is to liquidation;
- ✅ The higher the Risk Ratio, the more sufficient the risk buffer.
How the Risk Ratio Is Calculated
Risk Ratio = (Position Margin − Maintenance Margin) / Position Value × 100%
1. Metric Definitions
(1) Position Margin: Funds allocated to cover position losses and maintain the position open.
- Under Cross Margin and Isolated Margin modes, the calculation method of position margin differs.
(2) Maintenance Margin: The minimum margin required to maintain the current position.
- Maintenance margin is affected by factors such as position size, pending orders, order price, mark price, and position tier.
(3) Position Value: The value used to measure the current risk exposure of the position.
- The calculation method varies depending on Cross/Isolated Margin mode and One-way/Hedge position mode.
🔗 For calculation details, please refer to: Margin Terms, Position Concepts and Calculation Rules >>
2. Risk Ratio Tier Breakdown
Risk Ratio reflects the current risk profile of a position. The specific level shall be subject to real-time display on the page.
| Risk Ratio Chg | Risk Level | Description |
| ≥ 30% | 🟢 Low Risk | Position Margin is sufficient, and the position is far from liquidation. Please continue to monitor account risk. |
| 10% - 30% | 🟡 Low-Medium Risk | Position Margin is relatively sufficient. No immediate liquidation risk. Please closely monitor account risk. |
| 3 - 10% | 🟠 Medium-High Risk | Position Margin is relatively low. Please monitor account risk in a timely manner, and close the position in advance or add margin. |
| ≤ 3% | 🔴 High Risk | The position is very close to liquidation. Even minor price fluctuations may trigger liquidation. The system will issue a liquidation warning. Please add margin immediately or close the position in advance. |
| Drops to 0% | ❌ Liquidation Triggered |
Position margin is not sufficient to cover the maintenance margin. The system will proceed with order cancellation and liquidation processing. Note: If the Risk Ratio recovers above 0% after order cancellation, the subsequent liquidation process will be halted. |
About Liquidation Price
💡Whether the liquidation process is triggered is determined solely by Risk Ratio, rather than the referenced liquidation price displayed on the page.
Liquidation Price is a theoretical reference price calculated by the system based on the current position, margin, pending orders, and real-time market data. It may update dynamically as the Mark Price, position size, pending orders, and account balance change. This estimate is for reference only.
- In Cross Margin Mode, the Liquidation Price is calculated based on the overall risk of the Cross Margin account under the same margin asset. Therefore, the PNL of other Cross Margin positions, pending orders, or balance changes may also affect the Liquidation Price displayed for the current market.
- In Isolated Margin Mode, the Liquidation Price is calculated independently for each isolated position and is not directly affected by Cross Margin positions or other isolated positions. In Hedge Mode, the Liquidation Price for isolated long and short positions is calculated separately.
When placing an order, the system assumes that the current order is filled and calculates the “Estimated Liquidation Price” based on the expected position size, execution price, margin requirements, and other metrics. In One-Way Mode, the Estimated Liquidation Price is displayed by default; in Hedge Mode, it is only displayed when opening a position. Estimated Liquidation Price is not calculated for Trigger Orders or Scaled Orders.
Note: The liquidation price is only a theoretical reference value. It does not mean that the position will be liquidated at that exact price, nor does it represent the final execution price of liquidation.
Differences in Risk Ratio Between Cross Margin and Isolated Margin Modes
1. Cross Margin Mode
The Risk Ratio is calculated collectively for all cross-margin positions backed by the same margin currency.
For example:
Multiple trading pairs in a USDT cross-margin account share margin and risk. The PNL, changes in orders, or margin changes of any cross position may affect the overall cross Risk Ratio of the account.
2. Isolated Margin Mode
The Risk Ratio is calculated independently for each isolated position.
The margin of that position is isolated from others, so changes in its risk generally do not directly affect other isolated positions.
Note: In Hedge Mode, both long and short positions can be held simultaneously on the same trading pair.
- Under Cross Margin mode, risk is calculated at the account level;
- Under Isolated Margin mode, risk is calculated separately for long and short positions.
Factors Affecting Risk Ratio and Liquidation Price
The following actions or market changes may cause fluctuations in the Risk Ratio:
- Changes in mark price, resulting in unrealized PNL changes;
- Opening, increasing, reducing, or closing positions, leading to changes in position size and margin;
- Placing, modifying, canceling, or executing orders, leading to changes in losses, frozen fees, maintenance margin, or position value;
- Adjusting leverage, or adding/reducing isolated margin;
- Funding fee settlement;
- Under the same margin currency, PNL or order changes in other cross-margin positions.
How to Reduce Position Risk
1. Add Margin: In Isolated Margin mode, adding margin can reduce risk.
2. Reduce Position Size: Appropriately reduce position value and maintenance margin requirements.
3. Cancel Orders: Cancel pending orders that may increase risk exposure to release part of the margin or reduce potential risk exposure.
4. Manage Leverage Prudently: Set appropriate leverage before opening a position to avoid holding positions beyond your risk tolerance during volatile market conditions.
Example
Assume a position with the following parameters:
- Position Margin: 1,000 USDT
- Maintenance Margin: 400 USDT
- Position Value: 20,000 USDT
As a result, Risk Ratio = (1,000 − 400) / 20,000 × 100% = 3%, and the risk level of this position is considered relatively high.
If the market continues to move unfavorably, causing the position margin to decrease or the maintenance margin to increase, the Risk Ratio may further approach 0%.
Reminders
1. The Risk Ratio and Liquidation Price change in real time based on the Mark Price, as well as account, position, and order data. The results displayed on the page may update dynamically with market fluctuations.
2. When submitting or modifying an order, the system will evaluate the risk level based on the expected execution result. If the order may trigger liquidation after execution, the system may reject the operation.
3. The Risk Ratio and Liquidation Price are only used to reflect the current risk profile and do not represent future price movements. Please manage risk comprehensively based on your position size, leverage, margin balance, and market volatility.