Dear Users,
We’ve upgraded the Multi-Assets Mode in BingX Perpetual Futures. It now supports Isolated Margin mode, enabling independent positions and more flexible fund management.
Web: Experience Now
App: Please update your app to version 4.55.0 or higher. (App availability may vary by store, please be patient).
1. What is Isolated Margin Mode?
In Isolated Margin Mode, a certain amount of margin is allocated to a single position so the risk is segregated from other positions. In the event of forced liquidation, the trader will only lose the entire margin of that position.
Example:
In Isolated Margin Mode, suppose you have 1,000 USDT as available margin in your Multi-Assets account and choose to use 100 USDT to open a position. The liquidation will only result in a loss of 100 USDT if the market moves unfavorably, effectively controlling risk.
In Cross Margin Mode, the entire account balance is used as margin and shared across cross-margin positions. A liquidation will lead to a loss of all available margin.
2. Advantages of Isolated Margin Mode
1. Independent Positions: Each position’s PnL does not affect others. A liquidation of one position won’t jeopardize the overall account security.
2. Flexible Asset Management: Each position can be managed independently. Traders can adjust margin levels based on the risk of each position, offering more flexibility in fund management.
3. Additional Notes
When users choose Cross Margin Mode in the Multi-Assets Mode, they can use their entire balance as margin. However, in Isolated Margin Mode, each position's margin is calculated independently.
LTV = abs(Σmin(Asset Balance - Isolated-Margin Position Margin, 0) * Index Price)) / Σ(max(Asset Balance - Isolated-Margin Position Margin, 0) * Index Price * Collateral Value Ratio)
When no positions are held in Cross Margin Mode, an LTV of 0.995 or higher will trigger automatic conversion.
Where Isolated-Margin Position Margin = margin used for each isolated-margin position + margin frozen by open orders in the Isolated Margin Mode.
As seen in the formula, the Isolated-Margin Position Margin impacts the LTV calculation. Therefore, the available margin displayed on the trading panel for opening an isolated-margin position will be a discounted value to ensure that the margin used won't cause the LTV to exceed 80% and thereby triggering automatic conversion when opening a position.
Example:
Suppose 100 USDT worth of BTC is transferred to the Futures account, and BTC's LTV ratio is 95%. In Cross Margin Mode, the available margin is 95 USDT.
In Isolated Margin Mode, without any positions in Cross Margin Mode, to prevent users from triggering automatic conversion when opening a position, the platform applies a Risk Discount (with a discount rate or LTV of 0.8) on the available assets for opening an Isolated-Margin position. Therefore, the available balance will be 95 * 0.8 = 76 USDT.
