Liquidation Price Calculator — User Guide & Reference
In a leveraged position, the liquidation price is where your position gets force-closed when the loss eats through the collateral. This guide explains every input and a worked example.
Disclaimer: This guide is provided for education only and does not constitute investment advice.
What liquidation means
Liquidation is the automatic close when equity falls below the maintenance margin requirement. Initial margin opens the position; maintenance margin keeps it open. The liquidation price is where that threshold is crossed.
How leverage moves the level
Higher leverage means less margin cushion, so a smaller adverse move consumes it. The liquidation level shifts toward your entry as leverage rises, shrinking your room to be wrong.
Cross versus isolated margin
Cross margin shares your whole balance as collateral, moving liquidation further away but risking more. Isolated margin limits the collateral to the position, capping the loss at what you allocated.
Worked example: long at $100 with 10x
You go long at $100 with 10x leverage. At 10x, a 10% adverse move would consume the margin before buffers, so the raw liquidation sits near $90. Maintenance margin pulls it closer than the raw 1-divide-leverage point. Your stop must sit comfortably above $90, with room for gaps.
How to use the calculator
Enter entry, size, leverage, and margin mode. Read the liquidation price. Place your stop comfortably clear of it — including room for fast moves between the two.
Common mistakes
The most common mistake is confusing liquidation with a stop loss. Another is using maximum leverage because the position feels small. And treating the entry-time liquidation price as permanent ignores that funding and fees shift it.
Parameters explained
| Parameter | What it means |
|---|---|
| Entry price | The price where the leveraged position is opened. |
| Leverage | The ratio of position size to margin. |
| Direction | Long or short — flips whether liquidation sits below or above entry. |
| Maintenance margin | The minimum collateral to keep the position open. |
Key concepts
Initial margin
The collateral required to open the position.
Maintenance margin
The minimum collateral to keep the position open.
Liquidation
The automatic close when equity falls below the maintenance requirement.
Mistakes traders make
✗ Confusing liquidation price with a stop loss
✓A stop is an order you choose; liquidation is a forced close by the exchange. In a gap, price can jump straight past the stop to liquidation.
✗ Using maximum leverage because the position 'felt small'
✓Higher leverage moves liquidation toward entry. Less margin cushion means less room to be wrong before the exchange closes you out.
✗ Treating the entry-time liquidation price as permanent
✓Funding, fees, and margin changes shift the level over time. Re-check it, especially for positions held across funding intervals.
When this tool fits — and when it does not
Use it when
- ✓Before any leveraged futures or margin trade.
- ✓When deciding between cross and isolated margin modes.
- ✓When placing a stop to ensure it sits safely clear of liquidation.
Skip it when
- ✗Trading leverage where you cannot state the liquidation price.
- ✗Assuming the stop will always fill before liquidation in fast markets.
- ✗Ignoring that cross and isolated margin move the level differently.
Practical tips that actually help
Always know both numbers
Liquidation is the hard boundary; your stop is the chosen boundary. Plan for the gap between them, not for perfect fills.
Choose margin mode deliberately
Isolated caps the loss to the allocated margin; cross shares the whole balance for a further liquidation level but more total risk.
Recalculate after funding payments
Each funding interval and fee nudges the liquidation level. Re-run the number on positions you hold overnight.
Related & next steps
Frequently asked questions
Is liquidation price the same as a stop loss?▾
No. A stop loss is an order you choose; liquidation is forced by the exchange.
Why does leverage move the liquidation price closer?▾
Higher leverage means less margin cushions the position, so a smaller adverse move consumes it.
What is the difference between cross and isolated margin?▾
Cross shares your whole balance as collateral; isolated limits collateral to the position.
Can liquidation happen even with a stop loss set?▾
Yes. In a violent gap, the stop may be skipped and price can run to liquidation.
Why does the liquidation price shift after entry?▾
Funding payments, fees, and margin changes all adjust the position over time.
How far should my stop sit from liquidation?▾
Far enough to survive a realistic gap. In volatile markets, a stop too close to liquidation can be skipped.
- Type
- User guide
- Updated
- 2026-09
- Source
- SoloTrade.io educational content
Liquidation prices depend on exchange rules and can shift with funding and fees.