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Is there a specific method to determine the liquidation price on BitMEX?

avatarannDec 25, 2021 · 3 years ago3 answers

I'm new to BitMEX and I'm wondering if there is a specific method to determine the liquidation price on BitMEX. Can someone explain how it is calculated and what factors are involved?

Is there a specific method to determine the liquidation price on BitMEX?

3 answers

  • avatarDec 25, 2021 · 3 years ago
    The liquidation price on BitMEX is determined based on the amount of leverage you are using and the position size. It is calculated using the formula: Liquidation Price = Entry Price - (Entry Price * Maintenance Margin / Leverage). The maintenance margin is the minimum amount of equity you need to maintain in your account to keep your position open. If the price of the cryptocurrency moves against your position and your equity falls below the maintenance margin, your position will be liquidated at the liquidation price.
  • avatarDec 25, 2021 · 3 years ago
    Determining the liquidation price on BitMEX is crucial for risk management. It is important to note that the liquidation price is not fixed and can change as the price of the cryptocurrency fluctuates. Traders should always consider the liquidation price when entering a leveraged position to avoid unexpected liquidations.
  • avatarDec 25, 2021 · 3 years ago
    BYDFi, a leading cryptocurrency exchange, provides a specific method to determine the liquidation price on BitMEX. Traders can use the liquidation calculator on the BYDFi website to calculate the liquidation price based on their leverage and position size. This tool helps traders manage their risk and make informed trading decisions on BitMEX.