1. Liquidation Risk Alert
AOFEX monitors all changes in margin account assets, computes risk rating and liquidation orders. When user’s risk rating reaches 125%, user’s account will trigger a warning and AOFEX will send a SMS and email warning to the user.
2. Account Liquidation
When a user’s margin account’s risk rating reaches 110%, AOFEX will trigger account liquidation process and send a SMS and email to the user.
3. Liquidation of Pending Orders
When a user’s liquidation status and risk rating falls below 110%, AOFEX will restrict user's transaction, cancel the current pending order and place a system liquidation order by the liquidation progress.It will give priority to the currency with more current account assets and sell them at market price until the loan assets and outstanding interest are returned.After the position is closed, the risk rate of the account is in a risk-free state, and any remaining assets can be transferred out of the account.
(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?
If market fluctuates too much, and the system fails to fully repay the borrowed assets and interest after the system's liquidation order under the liquidation progress, it is deemed to be a position overrun. When an account lips into negative account balance, the liquidation account will automatically return some assets; at the same time, the platform has a risk reserve fund to allow users to avoid additional losses, and the part of the negative account balance will be made up by the platform risk reserve fund.