| Guide
1. Trading Mode Overview
1.1 Isolated Margin Mode
1.2 Cross Margin Mode
2. Isolated Margin Mode Calculations
2.1 Funding Rate
2.2 Estimated Forced Liquidation Price
2.3 Unrealized PnL
3. Cross Margin Mode Calculations
3.1 Unrealized PnL
3.2 Equity (Net Value) Including Unrealized PnL
3.3 Position Margin
3.4 Available Margin
3.5 Margin Rate
3.6 Funding Rate
3.7 Estimated Forced Liquidation Price
1. Trading Mode Overview
1.1 Isolated Margin Mode
In Isolated Margin Mode, each position is independent. Forced liquidation would occur to an individual position if the margin falls to the liquidation point due to a loss.
1.2 Cross Margin Mode
In Cross Margin Mode, the margin of all positions and the remaining funds in the account will be shared to bear the risk. This means that each position can lose more than the margin of that specific position. When continuous losses lead to the account reaching the liquidation point, all positions will be forced to liquidate at the same time, and you will lose all account funds.
2. Isolated Margin Mode Calculations
2.1 Funding Rate
- Funding fees are exchanged and settled between the long and short positions every 8 hours. If the funding rate is positive, long position holders shall pay funding fees to short position holders, and vice versa.
- Funding Fee = Trade Size * Funding Rate * Direction
- All funding fees will be settled when closing a position.
2.2 Estimated Forced Liquidation Price
USDT-Margined Standard Futures: Est. Liquidation Price = Open Price + Close Price * [Trading Fees + Funding Fees - (1 - Adjustment Factor) * Margin]/(Total Trading Volume * Direction)
Coin-Margined Standard Futures: Est. Liquidation Price = Direction * Total Trading Volume * Open Price/[(1 - Adjustment Factor) * Margin + Direction * Total Trading Volume - Trading Fees - Funding Fees]
2.3 Unrealized PnL
Take USDT magin as an example:
Unrealized PnL Ratio = Direction * Trade Size * (Close Price - Open Price)/(Open Price * Margin)
Unrealized PnL = Unrealized PnL Ratio * Margin
3. Cross Margin Mode Calculations
3.1 Unrealized PnL
Unrealized PnL refers to the estimated profit and loss of all open positions, also known as floating PnL.
3.2 Equity (Net Value) Including Unrealized PnL
Ideally, after closing all positions, the account funds equal the equity before positions are closed.
E.g., user A deposits 100 USDT to an account and opens two positions (regardless of trade size). The unrealized PnL for the account is 5 USDT.
The equity is 105 USDT.
3.3 Position Margin
The sum of the initial margin of all orders.
E.g., user A opens two positions with 10 USDT margin and 5 USDT margin separately. Then the position margin is 15 USDT.
3.4 Available Margin
This is the amount of margin that can be used to create an order.
Please note that in the Cross Margin mode, the unrealized PnL will directly affect the "available margin".
As the unrealized profit increases, the available margin also increases; as the unrealized loss increases, the available margin decreases.
Therefore, in the Cross Margin mode, profit orders can offset other loss orders. Meanwhile, the floating profit can be used to open positions to improve fund use efficiency. Calculation: Available Margin = Equity - Position Margin (Min. 0).
For example:
User A deposits 100 USDT to an account and opens two positions. The unrealized PnL for the account is 5 USDT. The equity is 105 USDT. The position margin is 15 USDT. The available margin is 90 USDT.
If the unrealized PnL turns to 55 USDT, the equity increases to 155 USDT. The available margin increases to 140 USDT. (Floating profit can be used)
3.5 Margin Rate
The most critical indicator for measuring the account risks.
When the margin rate falls to 0%, the account will trigger a forced liquidation, which is the only basis for the forced liquidation of the account.
The higher the margin rate, the lower the risk, and vice versa.
Calculation: Margin Rate = Equity / ∑(Order Margin * Adjustment Factor) - 1
E.g., if the adjustment factor is 10%, equity is 150 USDT and the order margin is 15 USDT, then:
Margin Rate = 150 / (15*10%) - 1 = 990%
When the equity falls to 1.5 USDT, 1.5/1.5 - 1 = 0, which triggers the forced liquidation.
3.6 Funding Rate
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Funding fees are exchanged and settled between the long and short positions every 8 hours. If the funding rate is positive, long position holders shall pay funding fees to short position holders, and vice versa.
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Funding Fee = Trade Size * Funding Rate * Direction
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The funding fees will be deducted every 8 hours and generate records (different from the Isolated Margin mode).
3.7 Estimated Forced Liquidation Price
3.7.1 USDT-Margined Standard Futures
Assume that user A holds positions of multiple trading pairs. When the margin rate is <= 0, forced liquidation will be triggered.
Let's define Liq as the liquidation price:
Liq(BTC) = (∑An + K) / ∑Bn
Where A and B are related to BTC orders:
A = Margin * Leverage * Direction
B = Margin * Leverage * Direction / Open Price
K = ∑(Order Margin * Adjustment Factor) - Account Balance - Sum of PnL from other trading pairs
Where Order Margin is taken from all orders of all trading pairs.
3.7.2 Coin-Margined Standard Futures
Let's define Liq as the liquidation price:
Liq(BTC) = ∑Cn / (∑An - K)
Where A and K are the same as USDT-Margined Standard Futures:
A = Margin * Leverage * Direction
K = ∑(Order Margin * Adjustment Factor) - Account Balance - Sum of PnL from other trading pairs
C = Margin * Leverage * Open Price * Direction