At BaseFEX, the risk limits are implemented on all trading accounts in order to avoid the happening of large liquidations.
In case some users possess huge positions, they are actually posing high risks on the other users that they might face Auto-Deleveraging if the position cannot be fully liquidated. The
Step model helps avoid this through increasing margin requirements for large positions.
Dynamic Risk Limits
Every contract has a
Base Risk Limit and
Step. Combined with the base Maintenance Margin and Initial Margin requirements, these numbers are used to calculate the full margin requirement at each position size.
If the position size increases, the maintenance and initial margin requirements will increase as well. You need to authorize a higher or lower risk limit on the Positions panel. And if the risk limit changes, margin requirements will change automatically.
Instrument Risk Limits
|Term||Formula||BTCUSD Example (200 BTC)|
|New Maintenance Margin %||
|New Initial Margin %||
|BTC Maintenance Margin||