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Leverage is the engine that makes perp trading powerful — and risky. This page covers the three things you must understand before opening a leveraged position: margin, leverage, and liquidation.

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What is leverage?

Leverage lets you control a larger position with a smaller amount of money. With 100x leverage, $100 of margin controls $10,000 of position size.
Leverage multiplies both gains and losses. A 1% adverse move on a 100x position wipes out your entire margin.

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What is margin?

Margin is the collateral you put up to open a leveraged position. If your trade goes against you, your margin is what’s at risk.

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What’s the maximum leverage on Alpha?

Up to 100x. Maximum leverage may be lower on certain assets — check the asset’s market page in the app.

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What is liquidation?

If a leveraged trade moves against you far enough, your margin can no longer support the position and the system automatically closes it. When you’re liquidated, you lose your entire margin for that position.

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How is the liquidation price calculated?

Based on:
  • Your entry price
  • Your leverage
  • Your margin amount
  • Funding payments accrued
The current liquidation price is displayed for every open position.

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How do I avoid liquidation?

Use lower leverage

More breathing room before liquidation.

Add margin

Top up margin on a losing position to push your liquidation price further away.

Set a stop loss

Exit on your terms before the system liquidates you.

Size responsibly

Don’t risk more than you can afford to lose.

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What is auto-deleveraging (ADL)?

In extreme market conditions, if losing positions can’t be liquidated normally, the system may close winning positions on the other side to balance the book.

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Is there an insurance fund?

Yes — an insurance fund covers losses from liquidations that occur faster than the system can close them. This protects winning traders from socialized losses.