Liquidation Price Calculator: method, checked example and practical limits
Estimate an isolated linear-position liquidation price from entry, leverage and maintenance margin. The threshold illustrates margin arithmetic rather than reproducing an exchange's official liquidation calculation.
Inputs used by this calculator
Liquidation Price Calculator uses the fields below. The starting values reproduce the page example; replace them with values from the same units and time period before using the result.
| Input | Starting example | Accepted value | How it is used |
|---|---|---|---|
| Position direction | Long | Long · Short | Supplies the position direction quantity used by the published equation or result breakdown. |
| Entry price | 50,000 | 0.000001 to 1000000000000000 | Supplies the entry price quantity used by the published equation or result breakdown. |
| Leverage | 10 | 1 to 1000 | Supplies the leverage quantity used by the published equation or result breakdown. |
| Maintenance margin (%) | 0.5 | 0 to 99 | Supplies the maintenance margin (%) quantity used by the published equation or result breakdown. |
| Estimated closing fee (%) | 0.05 | 0 to 99 | Supplies the estimated closing fee (%) quantity used by the published equation or result breakdown. |
Inputs and measurement conventions
The quantities used on this page are Position direction, Entry price, Leverage, Maintenance margin (%), Estimated closing fee (%). Start with values for the same situation and read the units attached to each field. The field reference below shows supported choices and numerical limits.
Mark price, margin tiers, funding, collateral and cross-margin balances vary by venue. A simplified number can differ materially from the actual threshold.
Method and equation
Apply the stated simplified isolated-margin approximation using entry, leverage, maintenance margin and closing-fee assumptions.
Liquidation Price Calculator uses the following stated relationship: simplified long liquidation ≈ entry × (1 − 1/leverage + maintenance margin + closing fee). Its assumptions determine which question the answer can resolve.
simplified long liquidation ≈ entry × (1 − 1/leverage + maintenance margin + closing fee)Worked calculation with the starting values
Position direction: Long; Entry price: 50000; Leverage: 10; Maintenance margin (%): 0.5; Estimated closing fee (%): 0.05. These starting values give 45,275 simplified liquidation price estimate. The calculation breakdown is Initial margin: 10; Maintenance margin: 0.5; Distance from entry: 4,725; Direction: long.
A 10× long at $50,000 with entered maintenance and fee assumptions produces a transparent estimate.
Reading the answer
The threshold illustrates margin arithmetic rather than reproducing an exchange's official liquidation calculation.
Initial margin: 10; Maintenance margin: 0.5; Distance from entry: 4,725; Direction: long. These intermediate quantities make the stated Liquidation Price Calculator model inspectable; they should be read together with the main answer rather than treated as independent guarantees.
Common errors and model boundaries
Mark price, margin tiers, funding, collateral and cross-margin balances vary by venue. A simplified number can differ materially from the actual threshold.
Exchange formulas, margin tiers, mark price, funding, collateral, cross margin and fees differ; use the venue's official liquidation engine.
Independent verification and next decision
No. Use the venue's documented calculator and position details for its operative margin and liquidation rules.
For the Liquidation Price Calculator method, compare simplified long liquidation ≈ entry × (1 − 1/leverage + maintenance margin + closing fee) with the starting inputs and the calculation table. The linked CFTC: understand the risks of virtual currency trading and Investor.gov: investing basics and FINRA: investing references identify the relevant definitions, conventions or domain limitations. Retain intermediate precision when comparing a manually worked answer.
Liquidation Price Calculator worked-example ledger
| Quantity | Example value | Role |
|---|---|---|
| Position direction | Long | Entered assumption |
| Entry price | 50000 | Entered assumption |
| Leverage | 10 | Entered assumption |
| Maintenance margin (%) | 0.5 | Entered assumption |
| Estimated closing fee (%) | 0.05 | Entered assumption |
| Main answer | 45,275 simplified liquidation price estimate | Calculated from the starting inputs |
| Initial margin | 10 | Intermediate or contextual output |
| Maintenance margin | 0.5 | Intermediate or contextual output |
| Distance from entry | 4,725 | Intermediate or contextual output |
| Direction | long | Intermediate or contextual output |
Frequently asked questions
Can I use it as the exact exchange liquidation level?
No. Use the venue's documented calculator and position details for its operative margin and liquidation rules.
Which relationship does the Liquidation Price Calculator use?
Apply the stated simplified isolated-margin approximation using entry, leverage, maintenance margin and closing-fee assumptions. The displayed relationship is simplified long liquidation ≈ entry × (1 − 1/leverage + maintenance margin + closing fee).
What do the starting values produce in the Liquidation Price Calculator?
Position direction: Long; Entry price: 50000; Leverage: 10; Maintenance margin (%): 0.5; Estimated closing fee (%): 0.05. These starting values give 45,275 simplified liquidation price estimate. The calculation breakdown is Initial margin: 10; Maintenance margin: 0.5; Distance from entry: 4,725; Direction: long.
How should I interpret this Liquidation Price Calculator answer?
The threshold illustrates margin arithmetic rather than reproducing an exchange's official liquidation calculation.
Which input mistake most affects the Liquidation Price Calculator?
Mark price, margin tiers, funding, collateral and cross-margin balances vary by venue. A simplified number can differ materially from the actual threshold.
What is outside this Liquidation Price Calculator model?
Exchange formulas, margin tiers, mark price, funding, collateral, cross margin and fees differ; use the venue's official liquidation engine.
What to keep in mind
Exchange formulas, margin tiers, mark price, funding, collateral, cross margin and fees differ; use the venue's official liquidation engine.
Results are rounded for display in US format, with money in dollars and cents; CSV exports keep full calculation precision. This is a calculation summary, not an official certificate.