Tiered maintenance margin ratio rules

A. What is Maintenance margin rate?

The maintenance margin rate is the minimum margin rate required by the user to maintain the current position.

When the margin rate of certain crypto under a Single currency cross position is <= 100%, the account will trigger forced position reduction.

Margin rate = (Balance in cross account of certain crypto + PnL in cross account - Selling amount of pending orders for certain crypto - Required amount of this crypto for an options buy order - Required amount of this crypto to open an isolated position - Commission fees of all placed orders) / (Maintenance margin + Commission fees of forced liquidation)

B. Why there are tiered maintenance margin ratio rules?

In order to avoid market liquidity from being impacted by the forced liquidation of large positions, resulting in large losses from position penetration, OKX applies tiered maintenance margin ratio rules. The larger the user's position, the higher the maintenance margin rate, and the lower the maximum leverage times that the user can set.

C. How to calculate the user's position and view the corresponding tier of maintenance margin rate

Under isolated margin mode, the positions in each direction of each contract are calculated separately for the number of contracts, the tier, and the required maintenance margin rate for the position;

Under cross margin mode, the positions in all directions of each contract are calculated together with the number of contracts, the tier and the required maintenance margin rate for the position. When the user has multiple contracts with expiry dates in one crypto at the same time, the user's total number of contracts will be calculated as all contracts of different expiry dates.

For example, if the user have 1,000 BTC weekly futures contracts, 500 bi-weekly contracts, 500 quarterly contracts, and 500 bi-quarterly contracts, so the user's total number of contracts is 2,500, which is in tier 2.

The following table shows the tier of maintenance margin rate of BTC USDT-margined futures contracts