Liquidation Suite

How to Calculate Liquidation Price on Isolated vs Cross Margin (Formula & Math)

The Isolated Margin Liquidation Formula

For isolated margin positions, the liquidation price depends exclusively on your entry price, your position direction (long or short), your leverage, and the exchange's maintenance margin rate (MMR):

### For Long Positions:
$$P_{liq} = P_{entry} \times \left(1 - \frac{1}{\text{Leverage}} + \text{MMR}\right)$$

### For Short Positions:
$$P_{liq} = P_{entry} \times \left(1 + \frac{1}{\text{Leverage}} - \text{MMR}\right)$$

For example, if you enter a Bitcoin long position at $100,000 with 50x leverage (where MMR is 0.5% or 0.005):
$$P_{liq} = 100,000 \times (1 - 0.02 + 0.005) = 100,000 \times 0.985 = $98,500$$

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Frequently Asked Questions

Why does my exchange show a slightly different liquidation price than the basic formula?

Exchanges deduct estimated liquidation taker fees and bankruptcy clearance fees from your remaining margin before executing the market order, resulting in a liquidation price slightly closer to your entry.