Margin, leverage and liquidation
Margin is the collateral behind a leveraged position; liquidation is what happens when it runs too low. Knowing where your liquidation price is matters more than knowing your leverage.
Cross and isolated margin
Cross margin, the default, shares one pool of collateral across all your cross positions: a winner props up a loser, and a large loss can take the whole pool. Isolated margin gives one position its own collateral, so its liquidation leaves the rest of the account alone.
Initial and maintenance margin
Opening a position needs initial margin: its size times the mark price, divided by the leverage you chose, which can be any whole number up to the market’s maximum. Keeping it open needs maintenance margin, set on Hyperliquid at half the initial margin at the market’s maximum leverage. A market with 40× maximum leverage needs 1.25% of the position’s value as maintenance margin.
When and how a position is liquidated
A position is liquidated when the account’s equity — or, for isolated margin, the position’s — falls below the maintenance margin, measured at the mark price. Hyperliquid first tries to close it with market orders on the book; positions over $100,000 are closed 20% at a time with a 30-second pause. If the book cannot restore the margin and equity falls below two thirds of the maintenance margin, the liquidator vault takes the position over.
A cross liquidation hands over all your cross positions and cross margin; an isolated one hands over only that position and its margin. For a cross position the liquidation price does not depend on the leverage you chose; for an isolated one it does, because leverage decides how much margin the position has.
Working it out before you trade
The liquidation price calculator on HyperBase applies each market’s margin tiers to an isolated position: enter the side, entry price, size and leverage. On the terminal, liquidation clusters show where tracked traders’ positions would be liquidated — levels the price can be drawn to.