Why does the available leverage suddenly drop when I’m planning to increase my position?
My understanding: You can think of the margin ratio as a progress bar toward liquidation—the closer it gets to 100%, the greater the risk. To bring the ratio down, you need to add margin or reduce your position.
Margin balance = wallet balance + unrealized P&L. As unrealized losses grow, the margin balance falls, causing the margin ratio to rise.
What I do: When the margin ratio is rising too quickly, I first consider reducing my position rather than endlessly adding margin and trying to tough it out.
Market update: $BTC is trading at 82956.58, up 1.67% over the past 24 hours.
My understanding: You can think of the margin ratio as a progress bar toward liquidation—the closer it gets to 100%, the greater the risk. To bring the ratio down, you need to add margin or reduce your position.
Margin balance = wallet balance + unrealized P&L. As unrealized losses grow, the margin balance falls, causing the margin ratio to rise.
What I do: When the margin ratio is rising too quickly, I first consider reducing my position rather than endlessly adding margin and trying to tough it out.
Market update: $BTC is trading at 82956.58, up 1.67% over the past 24 hours.