Liquidation Price Calculator
Calculate your liquidation price for any leveraged position. Supports crypto, stocks, forex, and futures trading.
Note: This calculator provides an estimate based on simplified liquidation formulas. Actual liquidation prices may vary due to exchange-specific maintenance margin requirements, funding fees, and other factors. Always leave additional buffer room for safety.
What is a Liquidation Price?
The liquidation price (also known as the liquidation level or stop-out level) is the critical price at which your leveraged position will be automatically closed by your broker or exchange. This happens when the market moves against your position and your margin balance falls below the required maintenance margin level.
When liquidation occurs, your position is forcibly closed to prevent further losses that would exceed your deposited margin. This is a risk management mechanism employed by all leveraged trading platforms to ensure they can recover the funds they lent you.
How to Use This Liquidation Calculator
- Select Asset Type: Choose the type of asset you're trading (Cryptocurrency, Stocks, Forex, or Futures). This helps you select appropriate default maintenance margin values.
- Choose Position Direction: Select Long if you expect the price to go up, or Short if you expect it to go down.
- Enter Entry Price: Input the price at which you opened (or plan to open) your position.
- Enter Position Size: Input the total number of units, shares, or contracts in your position.
- Set Leverage: Adjust the leverage slider or enter your leverage ratio directly. Higher leverage means liquidation will occur closer to your entry price.
- Set Maintenance Margin: Enter the maintenance margin percentage required by your broker. Common values are 0.5% for crypto, 1-2.5% for forex, and 25% for stocks.
Liquidation Price Formulas
The calculator uses these formulas to determine your liquidation price:
Long Positions:
Liq Price = Entry Price × (1 - 1/Leverage + Maintenance Margin)Short Positions:
Liq Price = Entry Price × (1 + 1/Leverage - Maintenance Margin)Understanding Your Results
- Liquidation Price: The exact price at which your position will be forcibly closed. Stay above this level to keep your position open.
- Distance to Liquidation: Shows how far the price can move against you before liquidation occurs. Larger distances mean more safety buffer.
- Position Value: The total notional value of your position (Entry Price × Position Size).
- Margin Required: The amount of your own capital that is locked as collateral for this position.
How to Avoid Liquidation
Managing liquidation risk is crucial for long-term success in leveraged trading. Here are proven strategies:
- Use Lower Leverage: The simplest way to increase your liquidation buffer is to reduce leverage. Even 2-5x leverage can provide significant exposure while keeping liquidation prices far from entry.
- Add Margin to Position: Also known as "topping up" or adding collateral, this increases your equity cushion and pushes the liquidation price further away.
- Set Stop-Loss Orders: Always set stop-loss orders at prices well above your liquidation level. This ensures controlled exit before forced liquidation occurs.
- Monitor During Volatility: Markets can move rapidly, especially during news events. Monitor positions closely and be prepared to act quickly.
- Use Isolated Margin: On platforms that support it, use isolated margin mode which limits losses to only the margin assigned to that specific position.
Common Maintenance Margin Requirements
Different asset classes and exchanges have varying maintenance margin requirements:
| Asset Type | Typical Maintenance Margin |
|---|---|
| Cryptocurrency | 0.5% - 1% |
| Forex (Major) | 1% - 2.5% |
| Stock Indices | 5% - 10% |
| Individual Stocks (US) | 25% - 30% |
| Commodities | 5% - 10% |
Note: These are typical values. Always check your broker's specific requirements as they may vary.
Frequently Asked Questions
What happens when a position is liquidated?
When a position is liquidated, the broker closes your trade at the current market price. You lose your initial margin and any additional funds in the position. In cross-margin mode, your entire account balance could be at risk. In isolated margin mode, only the margin assigned to that position is lost.
Can liquidation prices be negative?
Mathematically, the formula could produce negative numbers with extremely high leverage and high maintenance margin. However, in practice, asset prices cannot go negative in most markets. The calculator shows 0 as the floor value.
Why do different exchanges show different liquidation prices?
Exchanges use different maintenance margin requirements, funding rates, and fee structures. Some include additional buffers in their calculations. Always use your specific exchange's liquidation estimates for trading decisions.
Know Your Risk—Automate Your Protection
Calculating liquidation prices is smart risk management. Take it further by building automated Pine Script strategies with Pineify that set dynamic stop-losses and protect your capital automatically.