Margin Requirement
Last updated
Last updated
Margin requirement refers to the percentage of marginable assets that an trader is obliged to pay with his own assets. The margin requirement can be further subdivided into the Initial Margin Requirement and Maintenance Margin Requirement.
Should you have positions in several symbols of one trading pool, a total margin requirement would be calculated for all of your positions of the same pool. Please note accordingly, forced liquidations are executed on the account level too. In that case, you would lose all of your margin balance, i.e. your margin balance would become 0. For more details refer to our Liquidation or Trading FAQ
An initial margin requirement means the % of assets that is required if an investor opens a position.
The minimum Initial Maintenance Margin requirements of the specific Trading Symbol can be found on the Contract Info panel on the trading interface after selecting the Trading Symbol
Please note that when the Open Interest of a symbol surpasses some threshold, an Open Interest Multiplier will be applied to increase Initial Margin Requirement. Read Open Interest for more details.
The initial margin requirement always fixed for perpetual futures. You can find the initial margin requirement at the Contract Info
Let's assume a fictitious initial margin requirement of 8%
For instance, if you have 1,000 BUSD you wish to open a ETHUSD Perpetual Futures position, with a current spot ETHUSD price of 4,000$ , which requires 10% margin, the amount of ETHUSD position, you can buy as margin is calculated as follows:
Buying Power is less or equal to 1000 BUSD / 8% = 12500 BUSD
You can purchase up to 12500 BUSD worth of ETHUSD positions
Unlike the fixed margin requirement for Perpetual Futures, Everlasting Options adopt a Greek-based margin mechanism, which can be viewed on the contract info page. The details of the Greek-based margin mechanism can be found in the whitepaper.
Once the position is opened, the margin requirement represents the percentage quantity of assets that the investor must maintain in the margin account. This is called the "Maintenance Margin Requirement". If the investor is not able to keep the percentage quantity of assets above the Maintenance Margin Requirement, account level liquidation will occur.
The minimum Maintenance Margin requirements of the specific Trading Symbol can be found on the Contract Info panel on the trading interface after selecting the Trading Symbol
The Maintenance Margin Requirement always fixed for perpetual futures. You can find the maintenance margin requirement at the Contract Info
Let's assume a fictitious maintenance margin requirement of 4%
You have 10,000 BUSD worth of ETHUSD positions, using 5,000 BUSD on assets & 5,000 BUSD on margin. Since the Maintenance Margin Requirement is 4%, the value of the trader's 50% margin requirement has declined from 5,000 BUSD to 250 BUSD, resulting trader's account falling below the required maintenance margin level, which would be 500 BUSD.
Unlike the fixed margin requirement for Perpetual Futures, Everlasting Options adopt a Greek-based margin mechanism, which can be viewed on the contract info page. The details of the Greek-based margin mechanism can be found in the whitepaper.
Know the difference: Available Margin & Margin Usage Available Margin indicates assets that you still have available for trading (up to certain degree) and that are currently unused. Margin Usage are the used, not available assets that are in your current open position(s).
