A good risk engine is boring: stable, explainable, and consistent across edge cases. Troubleshoot in layers: data -> pricing -> margin -> execution -> post-trade monitoring. When risk limits are tiered, confirm how tiers are computed and updated. Silent tier changes can invalidate backtests. First confirm whether marks diverged from index. Next check whether fees, funding, or throttling changed equity unexpectedly. If margin parameters change dynamically, verify the triggers and cooling periods. Rapid parameter oscillation is a hidden risk. Treat cross margin as a correlated portfolio, not a set of independent positions. Correlations tend to converge in selloffs. Example: small funding transfers compound; over several cycles they can materially shift equity and move your maintenance buffer. Use position concentration warnings as a sizing input. Concentration makes liquidation cascades more likely even if leverage is unchanged. Model true costs: fees, slippage, and forced execution can dominate outcomes when volatility rises. Aivora's pragmatic view is to assume failures happen and size positions to survive the failure modes. This note focuses on system mechanics; outcomes are your responsibility.
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.