Margin Requirements

How Are Margin Requirements Calculated?

Margin requirements determine the amount of funds needed to open and maintain a trade. To calculate the margin required, follow these steps:

1. Gather Essential Information:

   • Contract Size: Find this under the Specification tab for the specific pair or instrument on MetaTrader.
     
     
     
   • Price: Check the current price on the MetaTrader chart for the instrument you are trading.
     
   • Lot Size: This represents the volume of the trade you wish to execute.
     
     
   • Leverage: This is set within your MetaTrader account settings.

2. Apply the Margin Calculation Formula:

   Use the following formula to calculate the margin required:

   Margin Required=LeverageContract Size×Lot Size×Price

• Important Notes:

  • The result from this formula is expressed in terms of the quote currency (the currency in which the instrument is quoted).
  • Convert the margin amount from the quote currency to your account's base currency if needed.

• Example Calculation:

  If you are trading the EURJPY pair:

  • Contract Size: Obtain from MetaTrader.
  • Lot Size: Specify your trading volume.
  • Price: Check the EURJPY price on MetaTrader.
  • Leverage: Use the leverage applied to your account.

  After computing the margin requirement, convert the result from JPY (the quote currency) to your account's base currency to determine the actual margin required.