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Liquidation is what happens when a leveraged position’s losses use up the margin behind it: the position is closed automatically, at market, and the margin is gone. It’s the worst case on a trade — and how far it reaches depends on the market’s margin mode. On an isolated-margin position, the most a liquidation can cost you is that position’s margin: your other positions and available cash are untouched. On a cross-margin position, losses draw on the shared balance backing all your cross positions.

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When it happens

A leveraged position needs its margin to stay above a maintenance level — enough collateral to credibly back the exposure. As the market moves against you, losses eat into the margin. If it falls to the maintenance level, the liquidation engine closes the position. Your liquidation price — the price at which that happens — is shown on the position screen before you confirm the trade and the whole time it’s open. It’s never a surprise: you can always see exactly how far away it is. The higher your leverage, the closer that price sits. At 20x, roughly a 5% move against you is enough; at 3x, the market has to move about a third against you. Choosing leverage is choosing your distance to liquidation.

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Staying clear of it

  1. Use less leverage. It buys you room to be temporarily wrong — which is most of trading.
  2. Set a stop loss inside your liquidation price. Then your defined exit triggers before the engine’s does, and you — not the mechanism — choose where the trade ends. See Take profit and stop loss.
  3. Watch margin health. Each position’s health indicator tells you how close it’s drifting — see Your balance.
  4. Act early. Reducing the position or adding margin while health is merely “getting worse” beats deciding under pressure when it’s critical.

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If a position is liquidated

On an isolated position, it’s closed and its margin is lost — that’s the full extent of it. Nothing else in your account is affected. On a cross position, the loss comes out of the shared balance backing your cross positions, which also shrinks the cushion behind the rest of them. If the closing orders do better than the worst case, whatever is left of the margin is returned to you — there’s no separate liquidation fee. And in both modes the loss stops at your account: a liquidation can’t leave you owing money.