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How Is the Liquidation Price for a Position Calculated?

Based on the entry price, leverage, and maintenance margin percentage; it is the price where margin equals maintenance margin.
Greeks.Live21.11.25

How Is the Liquidation Price for a Position Calculated?

The liquidation price is calculated based on the trader's entry price, the amount of leverage used, and the maintenance margin percentage set by the exchange. It is the price point at which the margin balance will equal the maintenance margin requirement.

The formula is designed to give the exchange enough time to liquidate the position before the account balance drops to zero.

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