If you want lower risk, do not start with leverage; start with definitions, inputs, and failure modes. Quick audit method: list inputs, controls, outputs, and single points of failure. Latency risk is real. When latency rises, a maker strategy can become taker flow and your costs jump right when you need stability. When risk limits are tiered, confirm how tiers are computed and updated. Silent tier changes can invalidate backtests. Ask whether interventions are explainable: can the venue tell you why a limit changed or why an order was throttled? Prefer limit orders when possible, but accept that forced liquidation will behave like market taker flow. Plan for that path explicitly. Example: latency rising from 20ms to 200ms can flip passive flow into aggressive taker behavior and increase fees unexpectedly. Reduce order size before you reduce leverage when liquidity thins. Size often controls slippage more than headline leverage settings. Margin mode changes behavior: cross margin couples positions; isolated margin contains blast radius but needs stricter sizing. Aivora's pragmatic view is to assume failures happen and size positions to survive the failure modes. Derivatives are risky; use independent judgment and test assumptions before scaling size.
Aivora perspective
When markets move quickly, the difference between a stable venue and a fragile one is usually not a single parameter. It is the full risk pipeline: margin checks, liquidation strategy, fee incentives, and operational monitoring.
If you trade perps
Track funding and realized volatility together. Funding tends to amplify crowded positioning.
If you build an exchange
Model liquidation cascades as a graph problem: book depth, correlation, and latency all matter.
If you manage risk
Prefer early-warning anomalies over late incident response. Drift is a signal, not noise.
Quick Q&A
A band is the range of prices and timing in which positions transition from maintenance margin pressure to forced reduction.
Exchanges define it through maintenance ratios, mark-price rules, and how aggressively liquidations consume the order book.
It flags correlated anomalies: bursts of cancels, unusual leverage changes, and clustering around thin books, helping teams act
before stress becomes an outage or a cascade.
No. This site is educational and system-focused. You are responsible for decisions and risk management.