Margin is the amount of money you must have in your Tradin account to open a leveraged trade. Think of it as a security deposit you place to cover potential losses.

Margin is not a fee or a cost. It is simply a portion of your own capital that is temporarily held, allowing you to access a much larger trade size through leverage.

How Margin and Leverage Work Together

Margin and leverage are two sides of the same powerful tool.

Here is how the margin percentage changes with different levels of Tradin leverage:

How to Calculate Your Margin

The margin required for any trade depends on its total size and the leverage you select.

The simple formula is: Margin = (Total Trade Value) / (Leverage)

Here are examples for opening a trade on a major currency pair like EUR/USD:

• Example 1: Using 1:100 Leverage
  1. You want to open a trade worth $10,000.
  2. Calculation: $10,000/100=$100
  3. You need $100 of your funds as margin to open this position.
• Example 2: Using 1:500 Leverage
  1. You want to open a trade worth $20,000.
  2. Calculation: $20,000/500=$40
  3. You only need $40 as margin to open this position.

What Happens When Margin is Low?

If your open trades lose money, your account equity (your balance plus or minus floating profits/losses) falls. If your equity gets too low to secure your open positions, the Tradin platform sends two critical warnings:

Margin Call (The Warning)

• This is an automated alert that tells you your account security level is insufficient to keep your trades open.
• You need to deposit more funds immediately, or close some positions to free up margin.

Stop Out (The Safety Measure)

• If you ignore the margin call and losses continue, our system will automatically begin closing your losing trades (starting with the least profitable one).
• The Stop Out is a core safety measure. It ensures your account cannot fall into a negative balance, protecting you from losing more money than you deposited, thanks to Negative Balance Protection.