Articles on: Trading


Your positions may sometimes be closed by a liquidation. Liquidations occur when a position loses all of its value (-100%). So a position is only liquidated once it has already gone bankrupt.

Only an individual position can be liquidated. On Morpher all of your positions are treated independently: one position going bankrupt does not affect any of you other trades.

Negative Balance Protection

You can only lose 100% of what you invest. The unique way we implement leverage means that you cannot go into debt with bad trades. And once a position liquidates there are never extra fees to be collected. This should give you extra peace of mind on every trade.

Going long/short with leverage on Morpher gives you more flexibility than options trading, without many of the risks (no expiration or payment due).

How to Prevent Liquidations

Use lower leverage.
A leverage of 2 already doubles your returns, while also doubling your risk. Try to use between 1-3x leverage to prevent the overall risk from wiping out your position before any gains.
Set a Stop Loss
Setting a stop loss can help minimize your losses so a bad day in the markets doesn't bankrupt your entire position.
Don't keep leveraged trades open for long.
Margin interest slowly reduces your position value every day. With high leverage this effect is even stronger. Closing a trade earlier avoids building up margin interest.

How to Calculate Liquidation Price

For buy/long positions, you can use this formula to estimate the price at which your position will be liquidated:
Liquidation Price = Trade_Price - Trade_Price/Leverage + Margin Interest

For sell/short positions, this formula can be used to estimate:
Liquidation Price = Trade_Price + Trade_Price/Leverage - Margin Interest

Note: Margin interest is variable, based on leverage and the number of days you keep a position open.

Understanding Your Liquidation

When a position is liquidated you'll get an email with details. You can also see the details of a liquidation in the History page in the app.

Incorrect Liquidation Price

After reviewing a liquidation, you may find the price does not exactly match your estimated liquidation price. This normal, and can happen for a few reasons.

Margin Interest

Margin interest is like a daily fee on leveraged trades, and can reduce a position significantly. Especially if you use high leverage. See our margin interest article for examples.

Delayed Execution

The price at which your position goes bankrupt and the price a liquidation is executed at do not have to match. Once a market hits a price that would bankrupt your position, we mark that position for liquidation. Liquidations are usually executed a few seconds later, but can sometimes happen minutes or hours later. This delay means that the liquidation trade price can differ from when we detected your position was bankrupt. Please review market prices before reporting an incorrect liquidation price.

Updated on: 14/07/2021

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