Risk & performance
Liquidation
Also known as: margin call, liquidated
Liquidation is the forced closing of a leveraged position when losses erode the margin below the required maintenance level.
When a position moves against a leveraged trader far enough, the broker or exchange automatically closes it to prevent further loss. In crypto especially, cascading liquidations can accelerate sharp moves. Conservative leverage and stops reduce the risk.
Related terms
Build strategies around liquidation without code — drag nodes onto the Algovex canvas, backtest, and export.
Build a strategy free →