Maintenance Margin
Maintenance margin is the minimum collateral or account equity a leveraged position must maintain to remain open under a venue's rules.
✦ Key Insight
It explains why liquidation can occur before the trader's collateral reaches zero.
✕ Common Misconceptions
Rules differ by product, risk tier, portfolio mode, and exchange.
Detailed Explanation
In Practice
Dig Deeper
Isolated Margin
Isolated margin is a margin mode where a specific amount of collateral is assigned to one leveraged position and the risk is largely separated from the rest of the trading account.
Margin
Margin is the collateral a trader provides to open and maintain a leveraged trading position. It is not the same as the total value of the position.
Mark Price
The mark price is a reference price used by many crypto derivatives platforms to calculate unrealised PnL and determine whether leveraged positions should be liquidated. It may differ from the last traded price visible on the exchange.
Liquidation
Liquidation occurs when a leveraged trading platform forcibly reduces or closes a position because the trader no longer has enough margin to satisfy the required maintenance margin.
Leverage
Leverage allows a trader to control a position larger than the capital committed to support it.