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Risk & Liquidation
How much room a Turbo Account has, and what happens if it runs out.
Every Turbo Account has a loss limit: how far its value can fall before the account closes. The limit is 4% of the account size and never moves. Throughout, the capital at risk is o2's, never your own.
Your loss limit
| Account | Loss limit | The account closes at |
|---|---|---|
| Turbo I ($2,500) | $100 (4%) | $2,400 |
| Turbo II ($5,000) | $200 (4%) | $4,800 |
| Turbo III ($10,000) | $400 (4%) | $9,600 |
The floor is measured from the account size and stays fixed for the life of the account. It does not rise with profits, and it does not fall when you claim.
Profit you make sits on top of that. Trade a $10,000 account up to $10,800 and you are $1,200 above the $9,600 floor, rather than $400. Claiming profit lowers the account's value toward the floor again, so claim with the room you want to keep in mind.
Your maximum out-of-pocket loss is the premium you paid.
What counts toward your balance
| Adds | Subtracts |
|---|---|
| Capital you have not yet deployed | Capital currently in a position |
| Cash on the account | Assets borrowed to open a short, at the ask |
| Assets held, at the bid | Fees accrued |
A new $10,000 account is worth exactly $10,000. Realized and unrealized profit raise it, losses lower it. This total, rather than any single position's P&L, is what the loss limit applies to.
Keeping room to trade
Two things determine how much room you have: your loss limit, and the size of the position you are running.
When a position is open, o2 sets aside about 1% of its value to cover the cost of unwinding it. The bigger the position, the more is set aside, and the less of your loss limit is free.
| Position on a $10,000 account | Set aside | Room left |
|---|---|---|
| Flat | $0 | $400, the full limit |
| $2,500 | ~$25 | ~$375 |
| $5,000 | ~$50 | ~$350 |
| $10,000 | ~$100 | ~$300 |
Key point: trading a smaller position gives you more room, twice over. Each price move costs less, and less of your limit is held aside.
The estimated close-out price
Every position shows an estimated close-out price: where your balance would reach the floor, given everything the account holds right now. It updates as the position changes.
| Position | Close-out price sits |
|---|---|
| Long | Below the mark price |
| Short | Above the mark price |
Close-only mode
As the account approaches its floor it switches to close-only. You can still reduce or close what you hold, and new exposure waits until there is room for it.
Treat it as an early warning. It is the signal to take a position off or let a winner run back.
If the loss limit is reached
- The account stops taking on new exposure.
- Open positions are closed into the book.
- Anything owed to o2 is settled.
- The account closes.
You do not owe anything further, and no other account of yours is affected. Profit you claimed earlier stays yours.
Staying in control
- Size positions with room to spare. Less is set aside and each move costs less.
- Use a stop loss. Your own stop exits on your terms, before the floor is reached. See Trading.
- Watch the account total, not one position. The loss limit applies to the whole balance, and fees count against it.
- Mind your slippage. An order whose worst-case fill could cross the floor is refused, so a tighter slippage setting can let a large order through.