What are the different leverage modes available on Bybit contracts?

Different Leverage Modes on Bybit Contracts

Bybit offers two primary leverage modes for its perpetual and futures contracts: Isolated Margin and Cross Margin. These modes define how margin is allocated and managed within a trading position, directly affecting risk exposure and capital efficiency. Traders must understand the mechanics of each mode to make informed decisions based on their strategy and risk tolerance.

Isolated Margin Mode Explained

In Isolated Margin mode, a specific amount of margin is assigned exclusively to a single position. This means the margin for that position is isolated from the rest of the account balance. If the position incurs losses, only the allocated margin is at risk, not the entire account equity.

• Traders can manually adjust the leverage level and margin amount for each position.
• The maximum leverage depends on the contract type and position size. For example, BTCUSD perpetual contracts allow up to 100x leverage in isolated mode.
• If the position approaches liquidation, traders can add more margin to prevent it.
• Liquidation occurs when the maintenance margin exceeds the allocated margin.
• Profits and losses are calculated based only on the isolated margin, making risk management more predictable.

This mode is ideal for traders who want precise control over risk per trade and wish to prevent one losing position from affecting others.

Cross Margin Mode Explained

Cross Margin mode uses the entire available balance in the wallet as margin for all open positions. This creates a shared pool of margin across positions, increasing capital efficiency but also exposing the entire balance to risk.

• The system automatically allocates margin based on position size and market conditions.
• Leverage is not fixed per position; instead, the effective leverage varies with the total equity used.
• Because all funds are interconnected, a loss in one position can impact the margin available for others.
• Liquidation occurs when the account equity falls below the maintenance margin requirement for all positions combined.
• This mode reduces the chance of liquidation under normal volatility due to broader margin support.

Cross Margin is preferred by traders who manage multiple positions and seek higher flexibility in margin utilization.

Switching Between Leverage Modes

Bybit allows users to switch between Isolated and Cross Margin modes, but certain conditions apply. This operation can be performed before opening a position or while managing an existing one.

• Navigate to the Contract Trading Interface on the Bybit website or app.
• Select the specific contract (e.g., BTCUSD).
• Locate the Margin Mode indicator near the position panel.
• Click on the current mode (e.g., 'Isolated') to open the selection menu.
• Choose the desired mode: Isolated or Cross.
• Confirm the change. Note that switching may require adjusting leverage or margin if a position is open.
• For open positions, the system may prompt you to manually set the new margin amount in Isolated mode after switching.

It is crucial to monitor liquidation price and margin ratio after switching, as these values will update based on the new mode.

Adjusting Leverage Levels

Leverage adjustment is independent of margin mode but interacts closely with it. Bybit allows dynamic leverage changes to suit market conditions.

• Open the contract trading page and select a symbol.
• Find the Leverage Selector (usually displayed as a slider or input box).
• Enter the desired leverage value (e.g., 10x, 25x, 50x).
• Confirm the change. A pop-up may appear warning about increased risk.
• In Isolated Mode, changing leverage affects the notional value of the position and recalculates the liquidation price.
• In Cross Mode, leverage adjustment influences the effective margin usage but does not isolate risk to a single position.

Maximum allowable leverage depends on the contract type, position size, and account tier. For instance, large positions automatically reduce maximum leverage to mitigate systemic risk.

Risk Management Implications

Each leverage mode carries distinct risk characteristics that traders must account for.

• In Isolated Margin, the risk is capped at the allocated amount, but improper margin assignment can lead to premature liquidation.
• In Cross Margin, although the entire balance supports positions, a sharp market move can wipe out the entire account.
• High leverage (e.g., 50x or 100x) amplifies both gains and losses, making stop-loss orders and take-profit levels essential.
• Traders should regularly check the maintenance margin rate and funding rate to avoid unexpected liquidations.
• Using partial close functions can reduce exposure without exiting the full position.

Understanding these dynamics helps in aligning the chosen mode with trading objectives, whether focused on capital preservation or aggressive speculation.

Frequently Asked Questions

Can I change leverage without closing my position?Yes, Bybit allows leverage adjustment on open positions in both Isolated and Cross Margin modes. However, in Isolated mode, changing leverage will recalculate the margin usage and liquidation price. Ensure your position has sufficient buffer to avoid immediate liquidation after the change.

Does Cross Margin mode increase my maximum leverage?No, maximum leverage is determined by the contract type and position size, not the margin mode. Both modes support the same leverage range (e.g., up to 100x for BTCUSD). However, Cross Margin may allow higher effective exposure due to shared equity.

What happens if I don’t manually add margin in Isolated mode?If the margin balance falls below the maintenance requirement and no additional funds are added, the position will be liquidated. Bybit issues margin calls via notifications, but it is the trader’s responsibility to monitor and act.

Can I use different margin modes for different contracts on Bybit?Yes, Bybit allows per-contract margin mode selection. You can trade BTCUSD in Isolated Margin while holding ETHUSD in Cross Margin. Each contract operates independently in terms of margin allocation and risk parameters.