Cross margin or isolated margin
Every perps venue asks this question once and then never mentions it again, which is unfortunate, because it decides what a single bad position can take from you.
- Live product data
- Self-custodial
- Human confirmed
Isolated margin
The margin you assign to a position is the only margin that position can consume. If it is liquidated, you lose that allocation and nothing else in the account is touched. The cost is that the position cannot borrow from your free balance to survive a move, so it is liquidated sooner than a cross position would be at the same size.
Cross margin
The whole account balance backs every open position. A position under pressure draws on free balance automatically, so it survives moves that would have closed an isolated one. The cost is symmetrical and much larger: one position moving badly enough can consume the margin holding up everything else, and a cross liquidation can take the account rather than a slice of it.
Which to pick
Isolated is the sane default for a directional trade you have sized deliberately, especially in an illiquid or high-volatility market where you want a hard ceiling on the loss. Cross earns its risk when positions genuinely offset, such as a hedge or a spread, because then the shared balance is doing real work rather than just delaying an inevitable liquidation.
- Isolated: loss is capped at the allocation, liquidated earlier
- Cross: survives deeper drawdowns, but risks the whole balance
- Cross makes sense when positions hedge each other
- Isolated makes sense when one position is a standalone bet
The failure mode to avoid
The dangerous pattern is cross margin plus several unrelated positions in the same direction. They feel diversified and they are not: in a correlated selloff they all draw on the same balance at once, and the account is liquidated as a unit. If the positions do not hedge each other, the shared balance is not buying you anything.
What the mode does to your liquidation price
Under isolated margin the liquidation price is a real number you can compute from the entry, the size and the allocated margin, and it only moves when one of those changes or when funding is deducted. Under cross margin there is no such number. The account has one health condition that depends on every open position at once, and the per-position figure the interface displays is a projection that assumes nothing else moves. In a correlated selloff, that assumption is exactly the one that fails, which is why the displayed number feels wrong precisely when it matters.
Frequently asked questions
- Can I switch modes on an open position?
- Venue-dependent. Many allow it while a position is open and recompute the liquidation price immediately; some require you to close first. Check before you rely on being able to switch mid-trade, because the answer differs between venues in the same app.
- Which mode gets liquidated first?
- Isolated, at the same size and leverage, because it cannot pull margin from the rest of the balance. That earlier liquidation is the feature, not the drawback: it is what bounds the loss.
- Does the mode change my funding payments?
- No. Funding is charged on notional and is identical either way. The mode only decides which pool of margin the payment is taken from.
- Is cross margin what professionals use?
- Professionals use cross where positions genuinely net against each other and isolated where they do not. Treating cross as the sophisticated choice is how a single position takes an entire account.
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Perpetual futures are leveraged instruments and can lose more than your initial margin. Nothing on this page is investment advice.