How Maintenance Margin Works
Every exchange and broker sets maintenance margin requirements, typically expressed as a percentage of the position value:
- Crypto exchanges: Usually 0.4% - 5% depending on leverage and position size
- US stocks (Reg T): Minimum 25% (FINRA requirement)
- Forex: Varies by pair, typically 1-5%
- CFD brokers: 50% of initial margin (common EU regulation)
Example:
- Position value: $100,000
- Maintenance margin rate: 1%
- Required maintenance margin: $1,000
- If your equity drops below $1,000, liquidation is triggered
Maintenance Margin vs Initial Margin
| Aspect | Initial Margin | Maintenance Margin |
|---|---|---|
| When | To open a position | To keep it open |
| Amount | Higher | Lower |
| Purpose | Entry collateral | Minimum to avoid liquidation |
| Example (10x) | 10% ($10,000) | ~5% ($5,000) |
Tiered Maintenance Margin
Most crypto exchanges use tiered maintenance margins based on position size:
| Position Size | Maintenance Margin |
|---|---|
| $0 - $50,000 | 0.4% |
| $50,000 - $250,000 | 0.5% |
| $250,000 - $1M | 1.0% |
| $1M - $5M | 2.5% |
| $5M+ | 5.0% |