Whether you need to reduce your position depends on your risk rate. The risk rate is the "lifeline" of your futures account. When it falls below a certain threshold, forced liquidation will be triggered. So deciding whether to reduce your position comes down to checking if the risk rate is approaching the danger line, or you actively adjust positions to lower risk.
Step 1: Find and Understand Your Risk Rate
First, find out what your current risk rate is and what it means.
What to do: On the Binance Futures trading interface, find the real-time display of "Risk Rate" or "Margin Rate".
How to do it: Log in to the Binance App or website, and go to the "Futures" trading page. In your position information section, you can usually see the "Risk Rate" indicator. If your account is in Isolated Margin mode, each position has its own independent risk rate; if in Cross Margin mode, the entire account shares one risk rate.
Completion standard: Note down your current risk rate percentage value.
Risk warning: Risk rate is not fixed; it changes in real time with market price fluctuations. When the risk rate approaches 100%, it means your position is at extremely high risk of forced liquidation, and the system will start sending margin call notifications. Don't wait until only a small margin is left—by then, there may not be enough time to act.
Step 2: Judge Whether to Reduce Based on Risk Rate
The level of risk rate directly corresponds to different risk levels, and you need to decide the next step accordingly.
Situation A: Risk rate below 80% (relatively safe zone). The account risk is still manageable, and you may not need to reduce your position immediately. But you should keep monitoring market movements to avoid the position deteriorating rapidly in violent fluctuations.
Situation B: Risk rate between 80% - 95% (warning zone). Position risk is high; a slight adverse price move could trigger liquidation. This is the signal to consider actively reducing your position. Actively reducing position size can release some margin, thereby increasing the risk rate and buying more buffer space for the account.
Situation C: Risk rate above 95% (high-risk zone). Your position is in imminent danger; any unfavorable price move could directly lead to liquidation. At this point, you should immediately and decisively reduce your position or add margin. If you can't act in time, the system may forcibly liquidate at any moment.
Common failure reason: Many users think the risk rate number looks okay, but ignore the impact of "wicks" or "slippage" in extreme market conditions. A sudden violent swing could cause the risk rate to jump from 90% to 100% directly, triggering liquidation before you can manually react.
Step 3: Execute the Position Reduction
If you decide to reduce, the operation itself is straightforward.
What to do: Partially or fully close your currently held position.
How to do it: In Binance Futures' "Positions" area, find the asset you want to reduce. Click the "Close Position" button, and in the pop-up window enter the quantity or percentage you want to reduce. You can choose "Market Close" to exit at the fastest speed, or set a "Limit Order" to wait for a better price to close part of the position.
Completion standard: Your position size decreases, and the risk rate value in the account rises accordingly, returning to a safer range.
Verification method after operation: After the reduction is complete, immediately check your "Risk Rate" number. If it has clearly risen compared to before the operation and is out of the "warning zone", the reduction has achieved the expected effect. Also, the quantity of that asset in your position list will have decreased accordingly.
Next step connection: After reducing position, your account releases some margin. These freed-up funds become "Available Balance". You can choose to keep them in the futures account as a safety cushion, or transfer them back to the spot account as needed. But reducing position is only a temporary risk management measure; the key is to review the root cause of why you got into this passive situation—was the leverage set too high, or was the entry point misjudged?
