🤔💸 You want to know your exact liquidation price, right? I learned this the hard way with a $5,400 lesson. Here's the formula every serious trader needs for isolated margin: Liquidation Price = Entry Price * (1 - (1/Leverage - Maintenance Margin Rate)). Let's use 0.5% for the MMR, which is common.
Imagine you have a $1000 account, go 10x long BTC at $60,000. Your initial margin rate is 1/10 = 0.1 (10%). So, LP = $60,000 * (1 - (0.1 - 0.005)) = $60,000 * 0.905 = $54,300. That's your safety net.
Now, same trade, but 20x leverage. Initial margin rate is 1/20 = 0.05 (5%). LP = $60,000 * (1 - (0.05 - 0.005)) = $60,000 * 0.955 = $57,300. See how much closer your liquidation is with higher leverage? It's not just about bigger gains; it's about much faster losses. Always calculate this *before*...
Imagine you have a $1000 account, go 10x long BTC at $60,000. Your initial margin rate is 1/10 = 0.1 (10%). So, LP = $60,000 * (1 - (0.1 - 0.005)) = $60,000 * 0.905 = $54,300. That's your safety net.
Now, same trade, but 20x leverage. Initial margin rate is 1/20 = 0.05 (5%). LP = $60,000 * (1 - (0.05 - 0.005)) = $60,000 * 0.955 = $57,300. See how much closer your liquidation is with higher leverage? It's not just about bigger gains; it's about much faster losses. Always calculate this *before*...