Auto-Cancellation of Orders
Trigger Condition: Account im% < 100% and account mm% > 100%
Auto-Cancellation Process: The system will start canceling open orders beginning with those that occupy the largest im, continuing until the account im% is greater than or equal to 100%. Once this threshold is reached, order cancellation stops.
Forced Liquidation
Trigger Condition: Account mm% ≤ 100%
Liquidation Process:
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Priority Order for Liquidation
The system will automatically select and sort positions to be processed based on the current risk exposure of the account:
- Priority on Short Options: The system will first liquidate short option positions that can most effectively reduce the account’s overall risk (Delta risk).
- Processing Long Options Afterwards: Only after all short positions have been processed and if the account status still does not meet requirements, will the system begin to reduce long option positions.
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Criteria for Position Selection
Once the direction for position reduction is determined, the system will identify specific contracts based on the following core factors:
- Liquidity First: The system continuously monitors the market depth for each expiration date, giving priority to contracts with better liquidity and higher trading activity to minimize execution resistance.
- At-the-Money First: For contracts with the same expiration date, the system usually prioritizes positions that are closest to at-the-money (ATM), ensuring that margin is quickly released within the most actively traded price range.
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Execution Strategy and Risk Control
To protect user interests and minimize market impact, automatic liquidation orders follow these execution guidelines:
- Execution Method: Orders use an "Immediate or Cancel" (IOC) and "reduce only" strategy, ensuring no unintended reverse positions are created.
- Pricing Mechanism: Orders are placed referencing the current market index price (mark price).
- Dynamic Calculation: The system automatically calculates the order size based on real-time market depth. If market capacity is weak, the system will place smaller orders in batches to prevent excessive slippage.
Gate reserves the final right of interpretation for this product.
Disclaimer
The content provided herein is for reference and educational purposes only and does not constitute any financial, investment, trading, or legal advice, nor does it constitute an offer or solicitation to buy or sell any digital assets. Gate makes no express or implied representations or warranties regarding the accuracy, completeness, or timeliness of the information contained herein. Product features, interfaces, rules, and fee structures may be updated or adjusted at any time. Please refer to the latest announcements and the actual information displayed on the Gate platform for the most accurate details.
Digital asset investments involve significant risk, and prices may fluctuate substantially. You may lose the entire amount of your investment. Please make decisions cautiously based on your own financial situation and risk tolerance after fully understanding the associated risks. If necessary, you are advised to consult an independent professional financial or legal advisor.
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