Forced Liquidation Process

Forced liquidation occurs when the margin reaches the maintenance margin level, your position must be liquidated, and you will lose all the maintenance margin. Forced liquidation is triggered when the mark price hits the liquidation price.

Key Points about Forced Liquidation:

1. Using Mark Price for Forced Liquidation: Venkate uses the mark price method to avoid forced liquidation caused by a lack of liquidity or market manipulation.
2. Higher Margin Levels Required for Larger Positions: Large positions, when liquidated, pose a risk of unsafe liquidation, affecting the market. Venkate's liquidation engine can use more margin to effectively liquidate substantial positions. If liquidation is triggered, Venkate will cancel all unfilled orders for the contract to free up margin and maintain the position. Orders for other contracts are unaffected. Venkate uses a partial liquidation method to gradually reduce positions, which helps decrease the maintenance margin requirement and avoid full position liquidation.
3. All Available Margin Used as Position Margin in Full Margin Mode: In full margin mode, all available margin is used as position margin. However, note that in full margin mode, the user's lost available balance will not be used as margin for other full margin positions.

Note:

• Long Position [UP]: Liquidation Price = (Entry Average Price * Quantity * Value + Maintenance Margin - Position Margin) / (Quantity * Value) (rounded up)
• Short Position [DOWN]: Liquidation Price = (Entry Average Price * Quantity * Value - Maintenance Margin + Position Margin) / (Quantity * Value) (rounded down)