To maintain account health, it is essential to understand how different order types and margin requirements work within your crypto CFD leverage trading (derivatives) account on Swyftx.
Order types
There are 5 different order types on the leverage trading platform on Swyftx: Stop, limit, stop loss, take profit, and market orders.
Stop, limit, stop loss, and take profit orders are not guarantees; they represent a request to open or close a position at a specified price. Once triggered, the order will be opened or closed at the next best available price, depending on what type of order you placed.
Market orders will execute instantly at the best available price (subject to slippage). This is applicable to both opening and closing a position on the Swyftx derivatives platform.
When you trade with leverage on Swyftx, you are speculating on the rising or falling prices of an underlying asset without owning or having any rights to the underlying asset itself.
Trading with leverage lets you gain exposure to a larger position with less upfront capital, but it materially increases risk, and losses can be substantial. This differs from Spot trading on Swyftx, where you buy and sell actual assets at the current market price (the 'spot' price). When you buy a crypto asset in spot trading, you own the asset itself and can hold, swap, withdraw, or sell it.
Account health
To manage your open positions, you are required to closely monitor your account health on the Swyftx leverage trading platform. You must be prepared to monitor and manage your account.
Margin call
A margin call occurs when your account equity falls below the required margin level. In this case, you may be required to deposit additional funds or close open positions to meet your margin obligations.
It is your sole responsibility to ensure that you are aware of and meet any margin calls.
Stop out
Your positions will be closed if your account equity falls below 50% of the margin required to cover your open positions. This is known as the stop out level.
Once your account equity falls to or below 50%, we will liquidate your positions, starting with those that are losing the most against the market.
You cannot rely on us to close out your positions on your behalf. We strongly encourage that you have exit strategies in place to help protect you against potential market movements. Stop losses are not guaranteed and may be subject to slippage during volatile market conditions.