Margin 101

Margin

Margin is the collateral locked against one position. Free collateral is what remains for new trades.

Leverage

Leverage sets position size: size = margin × leverage. Higher leverage magnifies both gains and losses.

Liquidation

A position is closed automatically once its loss reaches 90% of margin. Long liquidation price: entry × (1 − 0.9 ÷ leverage). Short: entry × (1 + 0.9 ÷ leverage).

Worked example

0.10 ETH margin at 3x is a 0.30 ETH long. If the price rises 10%, return on margin is +30% (before fees). If it falls 30%, the position is liquidated and 90% of margin is lost.