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

# Leverage & liquidations

> Margin, leverage, and liquidation

Leverage amplifies both sides of a trade. It's what turns a **1%** move into a real swing on your simulated balance — and what turns a bad entry into a liquidation. This page covers how leverage, margin, and liquidation work on Speculate's competition engine.

<Note>
  Competition trading runs on Speculate's own simulated engine using real market prices — it is not routed to a live exchange. Leverage, margin, and liquidation mechanics mirror a real perpetuals venue so the skill is real, even though the balance is not. Real USDC only ever moves through entry fees and prize payouts. See [Payouts](/competitions/payouts) for how simulated performance converts into real winnings.
</Note>

## Leverage

Leverage is adjustable per position, from **1x** up to the competition's maximum. Competitions run leverage caps as high as **100x**, set individually per competition.

* **Lower leverage** — more room before liquidation, smaller notional exposure per dollar of margin.
* **Higher leverage** — bigger notional exposure per dollar of margin, but a smaller adverse move liquidates the position.

<Warning>
  Higher leverage means a smaller price move can wipe out your margin. A **10x** position is liquidated by roughly a 10x smaller move than a 1x position. Leverage is a risk multiplier in both directions.
</Warning>

Check the competition's rules for its specific maximum before you size a position — see [Order types](/trading/order-types) for how leverage interacts with order execution.

## Margin mode

Competitions use **cross margin**. Your entire simulated balance backs every open position, rather than each position holding its own isolated slice of margin.

<Info>
  Under cross margin, gains and losses across all your open positions share the same collateral pool. A losing position can draw down margin that a winning position would otherwise keep safe — and vice versa.
</Info>

## Liquidation

A position is liquidated when your **equity falls below the maintenance margin requirement** for that position's size. Maintenance margin isn't a flat percentage — it scales with position size through a tiered schedule: bigger positions require a larger maintenance margin and cap out at lower maximum leverage.

<Steps>
  <Step title="Open a position">
    You post margin and select leverage up to the competition's cap.
  </Step>

  <Step title="Price moves against you">
    Unrealized losses reduce your equity on that position.
  </Step>

  <Step title="Equity crosses the maintenance threshold">
    Once equity falls below the maintenance margin requirement for your position's tier, liquidation is triggered.
  </Step>

  <Step title="Position is closed">
    The position is liquidated, capping further loss on that position within your simulated balance.
  </Step>
</Steps>

## Maintenance margin tiers

Maintenance margin requirements rise in steps as position size (notional) grows. Larger positions demand more maintenance margin and unlock less maximum leverage.

| Position size (notional) | Maintenance margin rate | Max leverage            |
| ------------------------ | ----------------------- | ----------------------- |
| Up to \~\$300,000        | \~0.4%                  | Up to 125x (engine max) |
| Mid-size tiers           | Progressively higher    | Progressively lower     |
| Largest tier             | Highest                 | 1x                      |

<Note>
  These are the underlying engine tiers. The **actual leverage cap you can select is set by each competition**, up to **100x** — a competition's max leverage will never exceed its own configured cap, even if the engine tier would technically allow more.
</Note>

<Tip>
  Smaller positions get the cheapest maintenance margin and the most leverage headroom. If you want to run high leverage, keep position size well inside the lowest tier.
</Tip>

<CardGroup cols={2}>
  <Card title="Payouts & ROI ranking" icon="trophy" href="/competitions/payouts">
    See how simulated performance is ranked and converted into real prize payouts.
  </Card>

  <Card title="Order types" icon="list" href="/trading/order-types">
    Review how market, limit, and other order types interact with leverage and margin.
  </Card>
</CardGroup>