FxPro Help Centre - Glossary

  1. Forex glossary terms and definitions
  2. Margin Level

Margin Level

"Margin Level" is a financial term used in trading, particularly in margin trading, which involves borrowing funds to invest in financial instruments. It is a key metric that indicates the health of an investor's trading account. The margin level is calculated as a percentage and is derived by dividing the equity in a trading account by the used margin. It is expressed as follows: Margin Level = Equity / Margin * 100. Here, equity is the total value of the trading account (including any open positions), and used margin is the amount of money that is currently being used to keep open positions. A higher margin level means that there is more free equity available to open new trades or sustain existing ones. A lower margin level indicates that a significant portion of the equity is tied up as margin, leaving less room for absorbing losses. If the margin level falls below a certain percentage (commonly set by the broker), it can lead to a margin call or automatic closure of positions to prevent further losses. This threshold is crucial for managing risk in leveraged trading.

Other terms in this category

Margin Calculator
Margin Call
Market Depth
Market Maker (MM)

We are here to help!

LiveChat
Instant help from qualified support
Request a call back
Request a call back
FxPro
Download the Guides
All PDF-instructions in one place
FxPro
Watch and Learn
Your questions answered in videos