The biggest edge is not a secret indicator; it is knowing what the system will do under stress. Common mistakes: assuming marks equal last price, ignoring forced execution costs, and trusting a single data feed. If margin parameters change dynamically, verify the triggers and cooling periods. Rapid parameter oscillation is a hidden risk. Another mistake: optimizing leverage while ignoring liquidity. Liquidity vanishes first, leverage magnifies the damage. Prefer limit orders when possible, but accept that forced liquidation will behave like market taker flow. Plan for that path explicitly. Example: a 0.05% extra cost on forced execution can erase multiple margin steps when leverage is high and moves are fast. Track basis, funding, and realized volatility together. The combination reveals crowding more reliably than any single metric. When risk limits are tiered, confirm how tiers are computed and updated. Silent tier changes can invalidate backtests. Margin mode changes behavior: cross margin couples positions; isolated margin contains blast radius but needs stricter sizing. Aivora discusses these topics as system behavior: define inputs, test edge cases, and keep controls auditable. 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.