> ## Documentation Index
> Fetch the complete documentation index at: https://docs.phoenix.trade/llms.txt
> Use this file to discover all available pages before exploring further.

# Account Health

> How Phoenix turns collateral and margin into health states and risk tiers

Phoenix expresses risk both as named tiers and as a numerical risk score.

## Risk tiers

| Tier                   | Meaning                                               |
| ---------------------- | ----------------------------------------------------- |
| `Safe`                 | Effective collateral is above initial margin          |
| `AtRisk`               | Below initial margin but not yet cancellable          |
| `Cancellable`          | Risk-increasing resting orders can be force-cancelled |
| `Liquidatable`         | Market-order liquidation can begin                    |
| `BackstopLiquidatable` | The account is beyond normal liquidation comfort      |
| `HighRisk`             | Deeply stressed and potentially ADL-eligible          |

## Risk score

A common Phoenix state score is:

* if maintenance margin is `0`, score is `0`
* if effective collateral is positive, score is approximately `(maintenance_margin / effective_collateral) * 1000`
* if effective collateral is zero or negative, score rises above `1000` with an underwater penalty

Interpretation:

* lower is healthier
* around `1000` means the account is at or through the liquidation boundary
* above `1000` means the account is underwater

## What improves health

* adding collateral
* reducing positions
* cancelling risk-increasing resting orders
* receiving positive funding
* positive mark-price movement on your exposure

## What worsens health

* adverse price moves
* paying funding
* adding more size
* placing more risk-increasing orders
* moving collateral out of the account

## Why the same position can have a different health state tomorrow

Because health is portfolio-aware and dynamic:

* mark price changes
* funding changes
* other positions in cross margin change
* positive-uPnL credit can be discounted