Margin is the amount required to open a leveraged trade. Leverage reduces the amount you need to provide upfront. For example, a $100,000 position would require $1,000 in margin at 1:100 leverage, assuming no additional product margin requirements apply.
Margin calculation methods
The calculation depends on the product and its margin settings.
Floating leverage — common currency pairs and gold
- Forex: Contract size × Lots × Margin percentage ÷ Account leverage
- CFD with leverage: Opening price × Lot size × Contract size ÷ Leverage
You can view your account leverage in the Client Portal.
Fixed leverage — exotic currency pairs and other products
- CFD: Opening price × Lot size × Contract size × Margin percentage
- CFD with initial margin: Initial margin × Lots × Margin percentage
You can view a product’s margin percentage in its Specification in MT4. If Margin Initial appears there, the product uses the initial margin calculation.
Example: One lot of EUR/USD
Suppose EUR/USD is quoted at 1.07390/1.07401 and you place a one-lot sell order. In this example, one lot represents 100,000 EUR, and the account currency is USD.
- Without leverage: 1.07390 × 1 × 100,000 = 107,390 USD
- With 1:100 leverage: 1.07390 × 1 × 100,000 ÷ 100 = 1,073.90 USD
These figures illustrate how leverage changes the margin requirement. The amount required for an actual trade depends on the product’s settings and the applicable price. Higher leverage reduces the margin needed to open a position but increases your exposure to potential losses.
