If you have wondered why two platforms liquidate the same position at different prices, the answer is usually in the rules. Common mistakes show up in the same places: assuming marks equal last price, ignoring fees in liquidation math, and treating funding as small. Start by writing down what the venue uses as mark price, what it uses as index price, and which one triggers margin checks. If those definitions are missing, your risk is already higher. Mistake to avoid: optimizing leverage while ignoring book depth. Liquidity vanishes first, and leverage just amplifies the damage. When slippage rises, reduce order size before you reduce leverage. Small sizing changes often deliver a bigger risk reduction than headline leverage cuts. Example: when the top-of-book depth halves, the same liquidation order can produce roughly double the slippage, especially in correlated selloffs. Treat cross margin like a portfolio: correlations matter. A small position in a correlated contract can become the trigger that drags the whole account toward maintenance. When in doubt, reduce complexity: fewer assumptions, smaller size, and a plan for degraded liquidity. Aivora frames these topics as system behavior, not hype: verify definitions, test edge cases, and keep risk controls simple enough to audit. Derivatives are risky. Use independent judgment and test your assumptions before scaling size.
Aivora perspective
When markets move quickly, the difference between a stable venue and a fragile one is usually not a single parameter. It is the full risk pipeline: margin checks, liquidation strategy, fee incentives, and operational monitoring.
If you trade perps
Track funding and realized volatility together. Funding tends to amplify crowded positioning.
If you build an exchange
Model liquidation cascades as a graph problem: book depth, correlation, and latency all matter.
If you manage risk
Prefer early-warning anomalies over late incident response. Drift is a signal, not noise.
Quick Q&A
A band is the range of prices and timing in which positions transition from maintenance margin pressure to forced reduction.
Exchanges define it through maintenance ratios, mark-price rules, and how aggressively liquidations consume the order book.
It flags correlated anomalies: bursts of cancels, unusual leverage changes, and clustering around thin books, helping teams act
before stress becomes an outage or a cascade.
No. This site is educational and system-focused. You are responsible for decisions and risk management.