How Futures Liquidation Uses Margin Thresholds, Risk Tiers, and Mark Prices
Summary
The document explains the main factors behind forced liquidation in Bitget futures: maintenance margin, mark price, position size and tier, margin mode, fees, and funding. It describes a 100% maintenance-margin ratio as the stated trigger for liquidation or partial liquidation, while noting that the applicable calculation depends on the contract, account mode, and risk tier. Larger positions can move into tiers with different maintenance requirements, changing estimated liquidation levels even when market prices are unchanged.
Partial liquidation may reduce exposure before a full closure. Isolated margin relies primarily on collateral allocated to a position, while cross margin shares eligible funds across positions and can transmit risk between them. After liquidation, fees may apply, with shortfalls potentially handled through an insurance fund or ADL. The article cites a March 2024 methodology using the lower of mark price or entry price for position value, but advises checking current contract terms because parameters can change. It gives no worked calculation or performance evidence, so the rules are best treated as a general guide rather than a substitute for current platform documentation.
Key ideas
- Liquidation or partial liquidation can begin when a position reaches its applicable maintenance-margin threshold.
- Risk tiers may raise maintenance requirements as notional exposure grows.
- Mark price and position value feed into risk calculations and can differ from the last traded price.
- Cross margin shares eligible collateral across positions, while isolated margin ties collateral more closely to a single position.
- Liquidation can involve fees and may lead to insurance-fund or ADL procedures if a shortfall occurs.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.