CashboardGlossary · Perps
What is leverage?
Leverage means holding a position larger than your own capital by posting margin, which multiplies both gains and losses on that margin.
How does leverage work?
Leverage is the ratio between position size and the margin behind it. $1,000 of margin holding $10,000 of exposure is 10x. On a perp venue the margin sits with the exchange or the smart contract, and the contract supplies the rest of the exposure.
At 10x, a 2 percent move in the asset is a 20 percent swing in your margin. At 50x, a 2 percent move against you wipes the margin out before fees. The maximum leverage a venue advertises matters much less than the leverage you actually use.
Two margin modes are common. Isolated margin limits the collateral at risk to what you assign to one position. Cross margin shares the whole account balance, which keeps a position alive longer but lets one bad trade drain the others.
Two imaginary traders each buy $5,000 of BTC exposure. One posts $5,000 at 1x. The other posts $500 at 10x. A 10 percent drop costs both of them $500 on paper. For the second trader that is the entire margin, and the venue liquidates the position before price even gets there.
Also called: margin trading, leveraged trading.
Where does leverage show up in Cashboard?
Paper trading takes any whole-number leverage on Hyperliquid perps, from 1x up to the maximum Hyperliquid sets for that market, and previews the margin an order ties up before you open it. Stocks in paper trading have no leverage. Fees and funding are not charged, so results look better than a real account would. Perps positions shows the leverage set on each position of a watched Hyperliquid account, plus account leverage: total position size over perps equity.
Frequently asked questions
Can you lose more than your margin with leverage?
On most crypto perp venues, no. You can lose the margin behind a position, and with cross margin the whole account balance, but a shortfall beyond that is covered by an insurance fund or a backstop vault, or failing that by auto-deleveraging, which closes part of the profitable positions on the other side. Losing all of your margin is the realistic risk, and at high leverage it only takes a small move.
Where can you read more about leverage?
Related terms
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