A margin level is the relation between a client’s equity and the total required margin for a trade expressed as a percentage. The reason margin level is important is that most trading platforms have a system which closes trades when the level falls to a certain value (generally 20%). Thus, a trade will need to be aware of his margin level in order to ensure he has enough funds to open a new position or keep a current position open.

Margin Level can be calculated using this formula: Margin Level = (Equity / Necessary Margin) x 100%.

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