Tiered Maintenance Margin Ratio System

1. What is Maintenance Margin Ratio?

Maintenance Margin Ratio is the lowest required Margin Ratio for a user to maintain the current open position(s). When the Margin Ratio of the account is lower than the Maintenance Margin Ratio + Liquidation Fee Rate, full or partial liquidation will occur.

Fixed Margin Mode: Margin Ratio = (Fixed Margin + UPL) / Position Value

Cross Margin Mode: Margin Ratio = (Balance + RPL + UPL) / Position Value

Position Value = Face Value x Number of contracts x Latest Mark Price

2. Importance of Maintenance Margin Ratio

This tiered Maintenance Margin Ratio system is adopted to avoid the liquidation of large positions, causing big impacts on market liquidity. Basically, the larger the positions held, the higher Maintenance Margin Ratio will be required, and the lower the Leverage will be available.

3. Maintenance Margin Ratio Tiers

Under Fixed Margin Mode, the Number of contracts and Tier are calculated based on all the positions for each contract. The Maintenance Margin Ratio is calculated based on the specific position for each contract.

Under Cross Margin Mode, the Number of contracts and Tier are all calculated based on all the positions for each contract. The Maintenance Margin Ratio is calculated based on all the positions of all contracts.

4. Maintenance Margin Rate gears for each Contract