> ## Documentation Index
> Fetch the complete documentation index at: https://docs.roxom.com/llms.txt
> Use this file to discover all available pages before exploring further.

# What happens if my position is liquidated?

> Understand what happens when your Roxom position is liquidated, how to reduce liquidation risk, and what to expect after.

Liquidation is when Roxom automatically closes your position because your collateral is no longer enough to keep it open. It's a risk control that protects you from going into a negative balance, but it also means you lose the margin assigned to that position.

***

## When liquidation happens

Your position is at risk when your **Margin Ratio** reaches 100%. This means your equity equals the **Maintenance Margin** required.

On Roxom, you'll get a warning when your margin ratio approaches 80%, but if it hits 100%:

1. Your open orders for that contract are cancelled
2. The system tries to close your position at or above your **Bankruptcy Price**
3. If there's any margin left after closing, it goes to Roxom's Insurance Fund
4. If there's a shortfall, the Insurance Fund covers it so you don't go negative

<Info>
  **Learn exactly how margin ratio, liquidation price, and bankruptcy price work** in the [Margin & Risk](https://docs.roxom.com/rulebook/liquidation-mechanics/liquidation-triggers-and-overview) section of our Rulebook.
</Info>

***

## Example

**Position details:**

* You're long 1 BTC of GOLD/BTC with 10x leverage
* **Initial Margin** = 0.1 BTC
* **Maintenance Margin** = 0.025 BTC

If losses reduce your equity to 0.025 BTC (equal to the maintenance margin), your margin ratio is 100% and liquidation will be triggered.

***

## How to reduce your liquidation risk

* **Watch your Margin Ratio**: Keep it well below 80%
* **Add more collateral**: Increase margin to your position
* **Reduce leverage**: Lower leverage decreases margin requirements
* **Use TP/SL**: Set a stop loss directly on your position to exit before you get too close to liquidation
* **Monitor your positions**: Avoid leaving large positions open without monitoring

<Info>
  **Learn how to set stop loss on your positions** in [How to set take profit and stop loss](/help-center/roxom-derivatives/how-to-set-take-profit-and-stop-loss).
</Info>

***

## After liquidation

If your position is liquidated:

* It will show as closed in your history
* Your margin is lost for that position
* You can keep trading with any remaining available balance in your account

<Note>
  Liquidation protects your account from going negative, but you will lose the margin used for that position.
</Note>

***

<Warning>
  This content is for informational purposes only and does not constitute investment advice. Trading digital assets involves significant risk, including the potential loss of your entire investment. Please review our [Risk Notice](/legal/risk-notice) before trading.
</Warning>

***

## Related articles

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