What leverage means here
On a perp, leverage is how much you borrow, and it comes with a price at which you get wiped out. On Isometric there is no borrowing and no liquidation. Leverage does two things: it sets how big your position is, and where your target sits.
Leverage sets position size
Your position size is your amount times the leverage, or a little more: the trade lands on the closest target that fits your leverage, and that target usually gives a few percent extra.
| Amount | Leverage | Position size |
| $500 | 5x | $2,500 |
| $500 | 10x | $5,000 |
| $500 | 25x | $12,500 |
| $500 | 50x | $25,000 |
| $500 | 100x | $50,000 |
Leverage moves your target
A bigger position for the same money means more risk. Higher leverage moves your Worthless at or below price closer to today's price, and at 50x and 100x past it, so less has to go wrong before the position is worth nothing.
Five seven-day Bitcoin longs with Bitcoin at $100,000 and a $500 amount:
| Leverage | Position size | Worthless at or below | Profit above | Max payout |
| 5x | $2,500 | $83,880 | $100,652 | $1,219 |
| 10x | $5,061 | $91,998 | $101,088 | $1,802 |
| 25x | $12,817 | $99,154 | $103,022 | $3,310 |
| 50x | $25,441 | $103,453 | $105,486 | $5,240 |
| 100x | $50,657 | $107,401 | $108,462 | $8,187 |
These are example figures. The exact prices move with the market and the ticket shows yours.
Read across a row and the trade at each tier is clear:
| Leverage | Where the worthless price sits | What a small move against you does | Payout per 1% past target |
| 5x | Far on the safe side of today | You get most of your money back | 5% of your amount |
| 10x | Closer | You get some of it back | 10% |
| 25x | Close to today's price | You can lose all of it | 25% |
| 50x | Past today's price | It needs a move your way to pay | 50% |
| 100x | Further past today's price | It needs a bigger move your way | 100% |
At low leverage the position behaves like a small, safe stake in the price: it is rarely worthless and rarely pays many times over. At high leverage a small move in your favour pays a lot and a small move against you costs the whole premium.
The exact distances move with the market. When the market is calm the targets sit closer. When it is volatile they sit further away, because a big move is more likely and the pool prices it in.
Leverage does not create a liquidation price
Nothing happens to your position while it is open. If a 25x long goes 10% against you on day two and recovers on day six, it pays in full on day seven. A perp at the same leverage would have been closed out on day two.
The cost of that protection is already inside what you paid. There is no margin to top up and no funding to pay.
Breakeven and the cap
- Breakeven usually sits a little past today's price. Each 1% past your worthless price pays back leverage percent of your amount, so breakeven is at most one leverage-share past the worthless price.
- The payout is capped. A long stops earning at its cap price and a short at its floor price. The ticket shows the Max payout in dollars, and the open position in Portfolio shows the price as Capped at or Floored at. Longer terms put the cap further away.
Choosing a leverage
Ask where you think the price will be at settlement, not how much you want to win.
- If you think it will drift your way or hold, pick low leverage. You keep most of your money across a wide range of outcomes.
- If you think it will move decisively, pick high leverage. Each 1% of the move pays more.
- If you are not sure, the middle tiers split the difference.
The ticket shows exactly where each tier puts the target. Move the slider and watch the worthless price, the profit price, and the max payout shift before you decide.