HOTCOIN Logo
Buy Crypto
Market
Trade
Futures
Earn
Rewards Hub
More
Web3 Wallet
Service Contacts

[email protected]

Product Feedback

[email protected]

Business Cooperation

[email protected]

Legal Contacts

[email protected]

Contact us
Service Contacts

[email protected]

Product Feedback

[email protected]

Business Cooperation

[email protected]

Legal Contacts

[email protected]

About us
Platform Introduction
Announcement Center
System Status
User Agreement
Privacy Policy
Legal Description
Products
Futures
Spot
Copy Trading
Margin
Earn
Trade Crypto via P2P
Buy Crypto with Card
Web3 Wallet
Service
Live Streaming
Hotcoin Elite Picks
Rewards Center
Friend Referral
VIP Benefits
Download
P2P Merchant Application
Support
Hotcoin Academy
Help Center
API Docs
Fee Rate
Crypto Info
Listing Application
Online Service
User Feedback
Official Verification
Trading
BTC USDC
ETH USDC
BTC USDT
ETH USDT
PI USDT
SOL USDT
XRP USDT
©2017-2026
Help Center
/Derivatives/Futures Trading/FAQ/
Margin & Risk FAQ
Help Center
/Derivatives/Futures Trading/FAQ/
Margin & Risk FAQ

Margin & Risk FAQ

Hotcoin
Share

  

1. What is Maintenance Margin?

Maintenance Margin is the minimum amount of margin required to maintain an open position.

If the account margin falls below the maintenance margin requirement, the system may trigger liquidation to prevent further losses.

  

2. What is Risk Limit?

Risk Limit is a risk control mechanism set by the platform based on different position sizes.

Larger positions usually require higher margin ratios to help reduce the risks associated with large positions.

If a position exceeds the current risk limit tier, the system may restrict opening additional positions or require additional margin.

  

3. Why was my position liquidated?

When the account margin is insufficient to maintain the current position, the system may trigger liquidation.

Common reasons for liquidation include:

  • Extreme market volatility
  • Excessive leverage
  • Insufficient margin
  • Failure to add margin promptly
  • Continuous funding fee deductions reducing available margin

   

4. How can I reduce liquidation risk?

You can reduce liquidation risk by:

  • Using appropriate leverage levels
  • Adding more margin
  • Setting take-profit and stop-loss orders
  • Controlling position size
  • Avoiding oversized positions during highly volatile market conditions

  

5. What is Auto Add Margin?

Auto Add Margin is a risk control feature.

When enabled, the system will automatically transfer funds from your available Futures Account balance to the current position when it approaches liquidation, helping reduce liquidation risk.

   

6. Why does the liquidation price change after adding margin?

After adding margin, the position margin increases, allowing the position to withstand larger price fluctuations.

This usually moves the liquidation price farther away from the current market price, helping reduce liquidation risk.

  

7. Does higher leverage mean higher risk?

Yes.

The higher the leverage, the greater the impact even small market price movements may have on your position PnL, which generally results in higher liquidation risk.

  

8. What’s the difference between Cross Margin and Isolated Margin?

Cross Margin uses more of the account’s available balance to share risk across positions, so positions are generally more resistant to market fluctuations.

Isolated Margin only uses the margin assigned to the current position. When margin becomes insufficient, the position may be more likely to be liquidated. However, the risk is usually limited to the margin allocated to that position and does not affect other available assets in the account.

You can choose based on your trading habits and risk preferences.

   

9. What is Margin Ratio?

Margin Ratio is an important indicator used to measure the risk level of a position and determine whether the account is approaching liquidation.

If the margin ratio continues to fall below the maintenance margin requirement, the system may trigger liquidation.

Margin Ratio is affected by factors such as position PnL, leverage, margin amount, and market volatility.

  

10. Why does increasing leverage reduce my maximum position size?

This is usually related to the platform’s risk limit mechanism.

The platform sets different risk limits and margin requirements based on position size. Under certain high-leverage tiers, the maximum allowable position value may be lower, which can result in a smaller maximum position size.

In addition, risk limits and maximum leverage rules may vary across different contract products. Please refer to the trading page for the actual rules.

  

11. What happens to the remaining funds after liquidation?

After liquidation is completed, any remaining funds will usually be retained in your Futures Account.

You can review your fund records or account balance for the actual settlement details.

Please note that liquidation-related fees may be incurred during the liquidation process, so the remaining amount may differ from your expectations.

 

 

Related Articles

 

Futures Order & Trading FAQs

Position & PnL FAQs

Quick Start Guide
Cryptocurrency Basics
Beginner’s Guide
App Guide
Start Trading
VIP Program
Rewards Center
Account Security & KYC
Asset Security
Security Settings
KYC Verification
Deposit & Withdrawal
Deposit
Withdrawal
P2P
P2P Trading Guide
P2P Merchant Management
P2P Rules & Agreements
Friend Referral
Spot Trading
Spot Trading
Pre-market trading
Derivatives
Advanced Trading
Grid Trading
Trend Trading
Fundamentals of Technical Analysis (Candlesticks / MACD / RSI)
Prediction Market
Futures Grid
Futures Trading
Getting Started
Contract Type
Trading Mechanics
Risk Management
FAQ
Copy Trading
Getting Started
Follower Guide
Lead Trader Guide
Terms of Service
Web3 Wallet
Getting Started
Swap
Hotcoin Card
Hotcoin Earn
Alpha
Startup
Platform Support
Agreements & Rules