Margin Account Liquidation Rules
- Margin Trading Guide
1. Liquidation Prewarning
The asset changes in a margin account are tracked real-time so that the risk rates and liquidation triggers are monitored closely. When a margin account's risk rate reaches 120%, a prewarning will be triggered and a specific message and email will be sent to the user.
2. Liquidation of Margin Account
When an account's risk rate reaches 100%, liquidation is triggered and the user will be notified of the liquidation event via the contact registered by this user.
3. Liquidation Orders
When an account's risk rate reaches 100% and is liquidated, its trading operation will be restricted and the pending orders will be canceled. The system will instead place liquidation orders to sell the assets to repay the outstanding debts and interests. After the liquidation, the account's risk rate will restore its safe status and the remaining assets can be transferred.
1. What are the prices for liquidation orders in isolated margin accounts?
The liquidation prices are based on market conditions.
2. In the event of negative equity, how is the negative part calculated and repaid?
When negative equity occurs, the account's asset is less than the sum of loan principal and interest. Negative equity = loan principal + interest - assets.
All assets in the liquidated margin account will be used to repay the loan principal and interests, and the negative equity part will be repaid by its subaccounts. Until they are paid up, the withdrawal function of the affected cross-margin or isolated-margin accounts will be limited.