Margin Calculator

How Forex Margin Works

Margin is the amount of money your broker holds as collateral when you open a leveraged position. It is not a fee — it's a deposit that is returned when you close the trade. The margin amount depends on three factors: position size, current price, and your leverage ratio.

For 1 standard lot of EUR/USD at 1.1050 with 1:30 leverage: (100,000 × 1.1050) / 30 = $3,683.33. This amount is locked in your account until the position is closed.

Leverage and Margin Relationship

Leverage is expressed as a ratio (e.g., 1:30, 1:100) and determines how much buying power you get per dollar of margin. The higher the leverage, the less margin you need — but also the closer you are to a margin call.

Margin Call and Stop-Out

A margin call occurs when your account equity falls below the required margin level — usually at 100% margin level. If the loss continues and equity drops to the stop-out level (typically 20-50%), your broker will begin closing positions automatically, starting with the most unprofitable.

To understand how position size affects your risk, use the position size calculator to size trades based on account balance and stop loss distance.

Regulatory Leverage Limits

Leverage is regulated differently by jurisdiction. Traders in the EU and UK are capped at 1:30 for major pairs under ESMA rules. Australian traders can access up to 1:30 (ASIC), while offshore brokers may offer 1:500 or higher. Always check your broker's regulatory status and understand that higher leverage increases both profit potential and risk.

Frequently Asked Questions

How is forex margin calculated?

Required Margin = (Position Units × Current Price) / Leverage. For 1 standard lot of EUR/USD at 1.1050 with 1:100 leverage: (100,000 × 1.1050) / 100 = $1,105.00. The calculator above updates instantly as you adjust pair, lot size, and leverage.

What is the difference between margin and leverage?

Leverage is the ratio (e.g., 1:100 means you control $100 with $1 of your own money). Margin is the actual dollar amount your broker locks up as collateral — $1,105 for a $110,500 position at 1:100. Higher leverage means lower margin requirement but also higher risk.

How much margin do I need for 1 lot of EUR/USD?

At 1:30 leverage: $3,683. At 1:100: $1,105. At 1:500: $221. These assume EUR/USD at 1.1050. EU/UK traders are capped at 1:30 by ESMA regulations — meaning you need $3,683 to open 1 lot, not $221.

Can I change leverage per trade?

No — leverage is set at the account level when you open your brokerage account. You can use this calculator to compare margin requirements at different leverage levels, helping you choose the right broker and account type for your trading style.