> For the complete documentation index, see [llms.txt](https://hopiumapp.gitbook.io/hopium/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://hopiumapp.gitbook.io/hopium/trading/margin-call-and-maintenance-margin.md).

# Margin Call & Maintenance Margin

### Margin Call

A margin call occurs when your trading equity falls below the maintenance margin. When this happens, your position is automatically closed, and your collateral is sold off to cover your losses, resulting in a 100% loss `PnL = -100%`.

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### Maintenance Margin

The minimum equity your position needs to maintain to avoid liquidation. If your equity falls below the maintenance margin: `Equity < Maintenance Margin`, your position will be liquidated.

**Formula:**\
`Maintenance Margin (USDT) = MMR * Total Size * Avg. Entry Price`

**Example:** \
If your position is worth $1,000 and the Maintenance Margin Rate is 0.5%, you need:\
`$1,000 × 0.005 = $5` as your Maintenance Margin.

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### Maintenance Margin Rate (MMR)

| Leverage     | Maintenance margin rate (MMR) |
| ------------ | ----------------------------- |
| 125X to >75X | 0.1%                          |
| 75X to > 50X | 0.2%                          |
| 50X to > 25X | 0.3%                          |
| ≥ 25X        | 0.4%                          |

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### Liquidation Price

The price at which a margin call occurs

* Long position: `Liq. Price = Entry - (Margin - Maintenance Margin)/Size`
* Short position: `Liq. Price = Entry + (Margin - Maintenance Margin)/Size`