Margin Call on Bybit
2021.11.11 05:04
Hi It's Unicorn
If you are doing margin trading, everyone has experienced a margin call at least once. This occurs when the forced liquidation price is reached due to excessive leverage or extreme volatility that occurred in a short period of time.
➢ A margin call occurs when the value of your margin account falls below the platform’s required amount. You need to deposit more money in the account or close your position to reduce your total risk exposure.
➢To use leverage, simply click the number below the yellow bar.
➢ You can check the order price and available quantity.
➢ You can select the position, Buy/Long or Sell/ Short.
Excessive leverage can lead to bankruptcy.
➢ If you set a position, it shows the status of the position like above. What you should always be aware of is the liquidation price.
➢ In the case of Sell/ Short, when the market price is higher than the liquidation price; or, when the market price is lower than the liquidation price. In the case of Sell/ Short, the current position is forced to liquidate as a reverse trade. A higher leverage ratio increases the likelihood of a forced liquidation.
➢ Also, excessive leverage will continue to be an expense because of the funding cost if you hold the position for a long time.