Execution quality is a risk control. When it degrades, every other parameter becomes less reliable. Implementation notes: treat the risk pipeline like software. Define inputs, version rules, and measure drift. Liquidation is a path, not an instant. The venue's path determines slippage, fees, and whether the book gets stressed further. Design for failure: stale feeds, sudden volatility, and latency spikes should trigger predictable safe modes. When risk limits are tiered, confirm how tiers are computed and updated. Silent tier changes can invalidate backtests. Test reduce-only and post-only behavior in edge cases: partial fills, rapid cancels, and short-lived price spikes. Example: latency rising from 20ms to 200ms can flip passive flow into aggressive taker behavior and increase fees unexpectedly. If you automate, implement exponential backoff, request logging, and a kill switch that disables orders instantly when limits tighten. Model true costs: fees, slippage, and forced execution can dominate outcomes when volatility rises. Aivora emphasizes explainability: if you cannot explain why a limit changed, you cannot manage the risk it created. 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.