Understanding Leverage (1x to 50x) & Margin Safety
How leverage really works, how initial and maintenance margin determine your liquidation price, and why lower is usually better.
How leverage works
Leverage lets you control a position larger than your margin. With $100 of margin at 10x leverage you control a $1,000 position. A 1% price move changes your position value by $10 — that is 10% of your margin.
Initial margin, maintenance margin & liquidation
- Initial margin is the collateral you post to open the position (position size ÷ leverage).
- Maintenance margin is the minimum collateral needed to keep it open — often 0.4%–1% of position value for major pairs.
- Liquidation happens when your losses eat your margin down to the maintenance level. The exchange closes the position and you lose the margin.
Interactive leverage & liquidation calculator
Adjust leverage and see how quickly the liquidation price approaches your entry. The estimate uses isolated margin and ignores fees and funding, so real liquidation will be slightly closer.
Leverage & liquidation calculator
Leverage: 10x
Position size
$1,000.00
0.01667 units
P&L per 1% move
±$10.00
10% of margin
Est. liquidation price
$54,300.00
Adverse move to liquidation
9.5%
Estimate for isolated margin with 0.5% maintenance margin. Excludes fees and funding.
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