Margin

Definition Margin is the amount of money needed as a "good faith deposit" to open a position with your broker. It is used by your broker to maintain your position. Other ways to think of margin is like a checking account with a minimum balance. When you hit margin it is like your account is at zero and the position is closed by the broker

Margin on FOREX Amount in the account when started Amount you would have in the account if you closed your position now Amount where the broker will close your position Margin amount available for additional trades Margin level in percentage of value If the margin percentage hits 100% it is the same as the amount under the margin column. The difference above 100% is represented by the free margin category.

FOREX Margin Calculator Find it at Day Trading University/Support/Margin Calculator

FOREX Margin Calculator When you hit calculate you see the volume you should enter on your platform. Lets make a trade and figure up the margin for this particular trade and figure out when we would get pulled out Enter the account balance Desired stop loss in pips Current price of the market Enter the leverage (Max. leverage with U.S. brokers is 50:1)

Margin on Futures Depends on the product traded Can vary depending on the broker Allows the broker a safety net against the leverage Can result in a Margin Call if you go below the required amount

Intraday vs. Overnight Intraday margins exist as long as you do not carry a contract from one day to the next Meaning if you have a trade in at 4:15 Eastern Time and the market closes for that day you are required overnight margin If you close all positions by 4:15 Eastern Time you can reopen the position at 4:31 Eastern Time and still have intraday margins

E Mini S&P 500 Most brokers will have a $500 intraday margin per contract For contracts held overnight the margin goes up around 10 times Margin is per contract, so to trade 10 contracts your margin would be at least $5,000 Hold those same contracts from one day to the next and your margin could be more than $50,000 Always leave room in your account for drawdown or for the trade to move against you for a period, each contract moves at $12.50 per price movement Margin for S&P minis should be $500 daily and roughly $5,500 overnight per contract. This means that when you have in a single contract the brokers considers your account at $0 when you hit your margin requirements. Be sure that you understand how margin works and if you do not call your broker and have him explain it in detail.

Euro Currency Future Intraday margins of $1,100 Overnight margins of 5 times intraday Margins are per contract Contracts move at $12.50 per tick Leave room in account for drawdown Lets work through some margin scenarios on futures