Cross margin vs isolated margin

Cross and isolated margin describe how collateral supports trading positions. With cross margin, positions share a pool of eligible collateral within an account. With isolated margin, collateral is assigned to an individual position under the venue's rules.

The practical question is what happens elsewhere when one position loses money. Sharing collateral can help absorb a loss, but it can also spread the effect of that loss across the account.

Cross margin: shared support

Under cross margin, profits or available collateral associated with one part of an account may support other positions. Losses reduce the support available to the whole portfolio. The eligible assets and how they are valued depend on the venue.

A position that would run out of separately assigned margin might survive when additional account collateral supports it. The reverse also matters: losses in another position can weaken an otherwise unchanged position's support. Cross margin does not always provide more room before liquidation.

A two-position example

Suppose an account has $20,000 of collateral, a $100,000 BTC long requiring $10,000 of initial margin, and a $25,000 ETH long requiring $5,000. This simplified example holds the margin requirements fixed and ignores fees, funding, collateral discounts, and open orders.

The BTC loss reduces the shared buffer. It does not need to be assigned to the ETH position to affect how much additional risk the account can take. In a live account, changing prices can also change the requirements themselves.

This is an initial-margin illustration, not a liquidation calculation. Liquidation uses maintenance rules and can involve different thresholds. See how liquidation works.

Isolated margin: collateral assigned to a position

Isolated margin separates a position's collateral from the support assigned to other positions. Under a model without automatic additions, spare funds elsewhere do not automatically rescue a position that runs out of margin.

That separation is useful for understanding the intended collateral boundary, but “isolated” does not universally mean that only the original deposit can ever be spent. Traders may add margin, some venues offer automatic replenishment from an available balance, and fees or funding have their own treatment.

For example, Bybit's automatic margin replenishment can transfer available account funds into an isolated position when enabled. Check the venue's rules and settings before treating the starting margin as a hard cap on total loss.

Compare the arrangements

Neither arrangement chooses an appropriate position size. A smaller margin allocation behind the same exposure does not reduce the dollar loss from a price move; it changes the buffer supporting that exposure. Position sizing explains the distinction.

How margin works on N1

N1 trading accounts use cross margin. Eligible positive token balances contribute collateral according to their weights, and requirements account for positions and potential exposure from open orders. The margin specification defines the entry, order-cancellation, and maintenance thresholds.

Separate subaccounts have independent balances, positions, and risk. Collateral in one does not automatically support another. A subaccount containing one position can separate its account-level risk, while its internal margin system remains cross margin.

Isolated and portfolio margin have separate development plans; consult the current roadmap for availability rather than assuming every margin mode is supported.

What to check in your account

Identify which assets support the position, how the venue values them, whether additional margin can be transferred automatically, and what else can draw on the same pool. Then check maintenance requirements as well as the initial amount needed to open the trade.

This gives a clearer picture of the funds at risk than the leverage setting alone.