- What is auto-add margin in isolated margin mode?
Auto-add margin is a key feature designed to enhance the safety of isolated margin trading. When a position's margin ratio approaches or falls below the maintenance margin requirement, the system may automatically add margin from your available account balance to the position to help prevent liquidation caused by insufficient margin. This mechanism helps reduce liquidation risk while providing greater flexibility in volatile market conditions.
- What are the advantages of auto-add margin in AlphaX futures trading?
1. Avoid the risk of liquidation
Futures trading is highly exposed to market volatility. If users fail to add margin in time, positions may face liquidation risk. When the margin ratio falls below a certain threshold, the auto-add margin feature is triggered to automatically add margin into the position, reducing losses caused by delays in manual action.
2. Increase trading flexibility
Traditional futures trading requires continuous monitoring of margin levels and manually add margin. With auto-add margin, users can focus on market analysis and strategy execution without worrying about insufficient margin.
3. Reduce the impact of market volatility
Auto-add margin helps stabilize positions and mitigate risks related to market fluctuations. By automatically adding margin, it helps maintain position stability, reduce volatility-driven losses. It also supports more rational decision-making by minimizing emotionally driven actions.
- How to use auto-add margin in AlphaX futures trading
1. Enable the feature
Users can enable auto-add margin feature under "Futures trading" > "Position orders (isolated margin)" > "Auto-add margin". Once enabled, the system will automatically add margin based on the amount preset by the user.
2. Set the margin amount
A higher margin replenishment amount provides stronger risk management but may reduce trading flexibility. Users are advised to adjust this parameter according to their trading strategy and risk tolerance.
- Notes:
(1) Monitor margin status: Auto-add margin is a risk management tool and does not guarantee the avoidance of losses. Users should assess the risks and benefits carefully and make decisions based on their own risk tolerance.
Margin added: If the available balance in your futures account is lower than the preset amount, the system will only add the available balance. In extreme cases, this may result in the loss of all available assets in the futures account.
(2) Fund transfer: When a reasonable mark price approaches the estimated close price of a position, available funds will be automatically transferred to the position margin. This ensures the margin ratio remains consistent with the user's configured leverage.
(3) Feature reset: Once the position is fully closed, the auto-add margin feature will be reset. You need to re-enable this feature each time you open a new position. This feature is only available in isolated margin mode.
- Example of auto-add margin
When a trader has an available balance of 2,500 USDT in the futures account, the position opening details are as follows:
Trading pair: BTC/USDT
Open price: 20,000 USDT
Open size: 0.5 BTC
Direction: long
Leverage: 10x
Initial margin: 1,000 USDT
Estimated liquidation price: 18,069.2 USDT
Remaining available margin: 1,500 USDT
Auto-add margin amount: 1,000 USDT
When the mark price drops to 18,069.2 USDT, which is the liquidation price, the auto-add margin will be triggered to prevent the position from being liquidated:
Added margin amount: 1,000 USDT
Remaining available margin: 500 USDT
New estimated liquidation price: 16,061.5 USDT
New initial margin for this position: 2,000 USDT
If the price of BTC/USDT continues to fall and reaches the new liquidation price 16,061.5 USDT, auto-add margin will be triggered again. Now, the futures account available balance is less than the margin user set:
Added margin amount: 500 USDT
New estimated liquidation price: 15,057.7 USDT
However, if the futures account has no available balance and the price reaches 15,057.7<0> USDT, this position will be liquidated because auto-add margin can no longer take effect.
- The auto-add margin feature in AlphaX helps users better manage risk, especially in volatile market conditions. Users should use this feature flexibly, monitor market conditions, and adjust strategies in a timely manner to manage risk and minimize potential losses. We hope this FAQ addresses any questions you may have about this feature.