1. Liquidation Risk Alert
Huobi Global monitors all changes in margin account assets, computes risk rating and liquidation orders. When user’s risk rating reaches 120%, user’s account will trigger a warning and Huobi Global will send a SMS and email warning to the user.
2. Account Liquidation
When a user’s margin account’s risk rating reaches 110%, Huobi Global will trigger account liquidation process and send notification to the user’s contact address.
3. Liquidation of Pending Orders
When a user’s liquidation status and risk rating falls below 110%, Huobi Global will restrict user’s trading activity and cancel all existing pending orders as per the liquidation process, up until all loaned assets and interests have been repaid will the liquidation process terminate. User can transfer remaining assets out once a user’s liquidation risk has been nullified.
(1) What are Isolated Margin Liquidation pending order price computed?
In principal, the order will be adjusted based on market conditions when the user’s risk rating falls to 100%.
(2) How is the repayment amount computed when the account slips into negative account balance?
When an account slips into negative account balance, the Margin Account Assets < Loaned Amount + Interest. In this situation, the following outstanding fees will be incurred: Fee Amount Owed = Loaned Principal + Interest – Margin Account Balance
A portion of assets will be automatically returned when an account is forced into liquidation, and child accounts with negative balance will further contribute to the total negative account equity. During this period both Cross Margin and Isolated Margin will result in limited withdrawal capability until the outstanding balance and fees are repaid.