Risk, margin, and liquidation

Perpetual contracts are leveraged derivatives. Adverse price movement, fees, funding, and changes in margin requirements can consume the collateral assigned to a position. The active execution route controls the final margin and liquidation calculation.

Leverage and exposure

Leverage measures exposure relative to supporting capital. A $1,000 position backed by $100 of initial margin has 10 times gross leverage before fees and other adjustments.

Higher leverage leaves less room for adverse movement. The leverage selector can also act as a buying-power limit under cross margin; changing it does not necessarily move the liquidation price of an unchanged order in direct proportion.

Maximum leverage is a ceiling, not a recommendation. Novrinex and the execution route can lower it by market, account, position size, volatility, or operating condition.

Margin modes

Isolated margin

Isolated margin assigns collateral to one position. Loss is generally contained to that position’s assigned margin, subject to fees, liquidation mechanics, and route rules.

Cross margin

Cross margin uses eligible account equity across several positions. A loss in one market can reduce the margin available to another. Closing one position or moving collateral can therefore change liquidation risk elsewhere in the account.

Not every route or market supports both modes.

Mark, index, and last price

The last traded price records the latest execution. The index tracks the market’s external reference. The mark price is the route’s risk price for unrealized profit and loss and liquidation checks.

These values can differ. Liquidation normally follows the mark price, not a chart’s last trade. Oracle-priced markets can also apply spreads, confidence rules, stale-feed controls, or session policies around the external reference.

Liquidation

Liquidation begins when account equity falls below the route’s maintenance requirement. The route can cancel orders, reduce positions, charge liquidation fees, transfer exposure to a backstop, or use an insurance mechanism according to its own rules.

The liquidation price displayed before execution is an estimate. It changes with:

• entry and mark prices;
• position size and direction;
• collateral deposits or withdrawals;
• other cross-margin positions;
• maintenance-margin tiers;
• funding and trading fees;
• partial fills and protective orders;
• route parameter changes.

Fast markets can move through the estimate before a manual close executes. A stop-loss can reduce risk but does not guarantee execution before liquidation.

Funding and carrying costs

Perpetual funding transfers value between long and short positions to anchor the contract to its reference. The sign, rate, interval, cap, and calculation differ by market. A rate displayed now can change before settlement.

Some oracle-priced markets use rollover, borrowing, or route-specific carrying charges instead of the same funding model as an order book. Review the live market terms.

Fees and funding reduce net returns and available margin. A position can lose money from carrying costs even if the underlying price is unchanged.

Liquidity and execution risk

Order-book depth can disappear during volatility. Market orders and triggered stops may fill across several prices. Limit orders can remain unfilled while the market moves away.

Oracle-priced contracts can reject execution, widen effective cost, or close during source-market interruptions. Equity, index, commodity, and FX products may gap when their reference session reopens.

Infrastructure risk

Current trading depends on Novrinex, the active execution venue, wallet networks, RPC services, bridges, market-data providers, oracles, and account APIs. Failure can delay submission, status updates, capital movements, or withdrawals.

Novrinex fails closed before a new order when required data or services are unavailable. That policy does not stop an existing position from moving or being liquidated at the external route.

Authorization risk

Trade-only credentials cannot withdraw funds, but they can place or cancel orders. Compromise could create positions, close exposure, or generate losses. Revoke an authorization immediately if the connected device, wallet session, or account may be compromised.

Managing an unresolved order

Do not submit a replacement while the terminal shows Unknown or Reconciling. The first command may already exist at the route. Wait for Novrinex to reconcile the external identifier, then confirm the resulting position and fill history.

Practical controls

• Start below the maximum leverage.
• Size from the loss you can bear, not the largest order the account permits.
• Keep enough free collateral for fees, funding, and mark-price movement.
• Check market hours and reference-price behavior before holding macro products across a closure.
• Use protective orders where supported and understand their execution limits.
• Test each new funding and withdrawal route with a small amount.
• Monitor the authoritative position after any interrupted submission or close.