Automatic Deleveraging

In the event that the insurance vault is insufficient to cover a liquidation loss, the Automatic Deleveraging System (ADL) will automatically deleverage traders holding positions in the opposite direction.

The ADL will deleverage traders in descending order of profit and leverage, i.e. the higher the profit and the more leverage used the higher the ranking.

Traders can view their priority ranking for automatic position reduction via the “ADL Ranking” indicator in the UI. Each light represents a 20% priority ranking, and when all lights are on, the position may be reduced in the event of a forced liquidation.

Positions will be reduced atomically: after the first user's position in line has been fully reduced, the second position will continue to be reduced and so on.

ADL ranking calculation method

Where:

• Effective leverage is mark value / (mark value - bankruptcy value)

• % profit is (mark value - average open value) / average opening value

• Mark value is the value of the position at the mark price

• Bankruptcy value is the value of position at the bankruptcy price

• Average opening value is the the value of position at average opening price