This article explains how liquidation (forced liquidation) works in both Cross Margin Mode and Isolated Margin Mode in futures trading.
⚠️ Basic Conditions That May Trigger Liquidation
In both Cross Margin and Isolated Margin modes, liquidation may occur when:
📌 Available balance becomes insufficient
📌 Maintenance margin requirements are not met
📌 Unrealized losses increase significantly
🔍 Liquidation in Cross Margin Mode
In Cross Margin Mode, margin is shared across the entire account.
💡 Features
✅ All cross positions share the same margin pool
✅ Profits from other positions may help offset losses
🚨 Liquidation Process (Cross Margin)
If liquidation occurs in Cross Margin Mode:
📌 Remaining cross positions may be processed together
📌 Processing may be performed in order based on trading symbols
Because margin is shared at the account level,
losses from one position may affect other open positions.
🔍 Liquidation in Isolated Margin Mode
In Isolated Margin Mode, margin is managed separately for each position.
💡 Features
✅ Each position has its own dedicated margin
✅ Impact is generally limited to the affected position
🚨 Liquidation Process (Isolated Margin)
If liquidation occurs in Isolated Margin Mode:
📌 Only the affected position will be liquidated
📌 Other positions and balances are generally not affected
📊 Leverage and Liquidation Risk
⚠️ Common Risk Factors
Higher leverage generally means:
📉 Liquidation price moves closer to entry price
📉 Small market movements may trigger liquidation
Always set leverage carefully and consider risk management.
🛡 Tips to Reduce Liquidation Risk
✅ Monitor margin balance regularly
✅ Monitor unrealized PnL
✅ Avoid excessively high leverage
✅ Consider adding additional margin when necessary
📝 Summary
Mode Liquidation Impact Scope
Cross Margin May affect entire account
Isolated Margin Usually affects only the specific position
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