# Account Health

## Liquidation Essentials

Liquidations on LODE occur when market movements cause a trader’s equity balance to drop below the maintenance margin, prompting the closure of all positions by a third-party liquidator. LODE’s cross-margin system means the equity balance reflects the total account, so liquidation impacts the entire balance. For targeted risk management, traders can use isolated sub-accounts.

## **Account Monitoring**

The 'Account Overview' on LODE provides vital indicators for monitoring account health, including dynamic estimates of liquidation prices, which are crucial for assessing risk levels.

{% hint style="info" %}
Estimated liquidation levels are simply estimates and may change with account health.
{% endhint %}

## **Liquidation Dynamics**

LODE’s estimated liquidation prices are indicative and subject to change based on account and market dynamics. Since the platform uses cross-margining, traders should focus on their equity balance to avoid account-wide liquidation.

## **Health and Margin**

* **Account Health**: A percentage indicating the margin of safety before liquidation, calculated by comparing the equity balance to the maintenance margin (CVA).
* **Maintenance Margin (CVA)**: The required margin depends on the trade’s leverage and size and is critical to avoiding liquidation.

## **Equity and Management**

* **Equity Balance**: Includes unrealized profits and losses, reflecting financial health. Monitoring this against the CVA is essential to prevent liquidation.
* **Remaining Equity to Liquidation**: An indicator that shows how close the account is to liquidation, offering a clear view of financial leeway.

## **Funds Allocation**

LODE distinguishes between locked margin and funds available for trading, guiding traders to effectively manage their resources for balance and opportunity.

## Conclusion

Effective management of account health and margins is crucial on LODE. By monitoring these metrics, traders can navigate risks and leverage opportunities in the market with informed strategies and precision.


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