ENTRY  N° 36  /  80
Glossary

Liquidation

Part of the theme Leverage, margin and liquidation.

Definition

Liquidation is the forced closure of a leveraged position by the venue when losses draw your margin down to the maintenance level.

The platform closes the position so the loss does not exceed your posted margin, usually with a fee and at a poor moment. Beginners are often liquidated not because they were wrong about direction but because leverage left no room for a normal move.

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