Essential

Margin

The collateral required to open and maintain a leveraged trading position.

Definition

Margin is the amount of money required to open and maintain a leveraged trading position. It acts as collateral against potential losses. Margin requirements vary by broker, instrument, and regulatory jurisdiction.

How It Works

Used margin: funds locked in open positions
Free margin: available for new trades
Margin level: (Equity / Used Margin) × 100%
Below margin call level triggers warnings

Types of Margin

Initial Margin

Required to open a position

Maintenance Margin

Required to keep position open

Variation Margin

Daily profit/loss adjustments

Trading Tips

Monitor your margin level constantly

Never use all available margin

Different instruments have different margin requirements

Related Terms

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