Brokers & Accounts
Beginner
Margin
Also called: required margin
The collateral required to open a position — a percentage of the notional value, set by leverage.
Definition
Margin is the ‘down payment’ your broker requires to let you control a leveraged position. With 1:100 leverage, margin = 1% of notional. With 1:30, margin = ~3.3%.
Example
Trade 1.0 lot EUR/USD = €100,000 notional. With 1:100 leverage, margin required = €1,000.
Formula
Margin = Position notional / Leverage ratio