In a unified trading account, your margin level determines when a position faces liquidation. If the margin level drops below 100%, the position may be partially or fully closed to mitigate risk.
👉 Discover how OKX's risk management protects your trades
How Liquidation Works
A common misunderstanding is that liquidation occurs at 0% margin level—this is incorrect. Positions are liquidated when the margin level falls below 100%, triggering a partial or full closure. A liquidation fee is then applied and contributed to the OKX Insurance Fund.
Partial vs. Full Liquidation
Depending on the position’s tier, the system may opt for partial liquidation first. If the margin requirement remains unmet, the process continues until the account is compliant or all positions are closed. This tiered approach minimizes market disruption during large liquidations.
Estimating Liquidation Prices
You can predict liquidation prices using the calculator on OKX’s derivatives trading page. Note: With multiple open positions, actual liquidation prices may differ from estimates due to unified account dynamics.
👉 Master margin calculations with OKX's expert guides
Margin Level Calculations by Account Mode
1. Single-Currency or Cross Margin Mode
- Formula:
Margin Level = (Equity / Used Margin) × 100% - Detailed guide here.
2. Multi-Currency or Cross Margin Mode
- Adjusts for multi-asset portfolios.
- Explore calculations.
3. Isolated Margin Mode
- Segregates risk per position.
- Learn more.
FAQs
1. Why does liquidation happen at 100% margin level?
To prevent negative equity, exchanges intervene early. A buffer ensures fees and volatility don’t push accounts into debt.
2. Can I avoid liquidation?
Yes. Monitor margin levels, add funds, or reduce position sizes before reaching critical thresholds.
3. How is the liquidation fee determined?
It’s a percentage of the position size, funneled into the platform’s insurance fund to cover extreme losses.
4. Does partial liquidation affect all positions?
No. Only under-margined positions are targeted, preserving others if they meet requirements.
5. Why do estimated and actual liquidation prices differ?
Unified accounts aggregate risk across positions. Isolated accounts calculate per-trade.
This content is for informational purposes only and does not constitute financial advice. Trading digital assets involves risk; ensure you understand the mechanisms before participating.
© 2025 OKX. Reproductions must credit: “This article is © 2025 OKX and is used with permission.”
### Key SEO Elements Integrated:
- **Core Keywords**: Liquidation, margin level, OKX, unified account, partial liquidation, risk management.
- **Structure**: Hierarchical headings, bullet points, and anchor texts for engagement.