How does margin work in a long position?
Example 1: Buying GBP/USD
A trader buys 1 contract of GBP/USD (100,000 GBP) at $1.2650.
How does margin work in a short position?
Example 2: Selling USD/JPY
A trader sells 5 contracts of USD/JPY (100,000 USD per contract) at ¥107.25.
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Amplify Trades with Margin & Leverage at FXTRADING.com
- Leverage up to 2000:1
- Live risk exposure management
- Mandatory 50% margin close-out rule
- 100% margin call level
- Negative balance protection
- ASIC (AFSL 337985): FXTRADING.com is authorised and regulated by the Australian Securities and Investments Commission, ensuring strict compliance with Australian financial services laws.
- VFSC (License No. 41694): Our international operations are regulated by the Vanuatu Financial Services Commission, providing global clients with access to competitive trading conditions under a robust regulatory environment.
Equity is calculated as follows: Equity = Account balance + Floating result for open positions. Please note that changes in leverage on your MT4/MT5 trading account may not immediately update margin parameters in your trading terminal. We recommend re-logging into your trading terminal after adjusting leverage for accurate margin parameters.
Please exercise caution, especially when using the highest leverage, as leverage reduction, as outlined in the table above, may increase your margin requirement and could result in liquidation if margin/equity falls below 50%.
* Additionally, leverage for currencies other than USD may vary flexibly according to the day-to-day exchange rate.
| Asset Classes | Leverage |
|---|---|
| Silver and Energies | 100:1 |
| Indices | 100:1 |
| Commodities | 100:1 |
| BTCUSD and ETHUSD | 100:1 |
| Other Cryptocurrencies | 20:1 |
| Stocks | 10:1 |
* Please note that FXTRADING.com reserves the right to adjust leverage at any time.
* Please take into consideration the impact of leverage levels on your trading.
Margin is the amount of capital required to open and maintain a leveraged trading position. It acts as a security deposit that allows you to control a larger position than your account balance would normally permit.
For example, with 100:1 leverage, a $1,000 margin lets you control a $100,000 trade. If the market moves against your position, losses are deducted from your margin.
FXTRADING.com offers several protection measures for leveraged traders:
- Negative Balance Protection: Ensures your losses never exceed your account balance.
- Stop-Out Mechanism: Automatically closes positions if your margin level falls below a critical threshold.
- Tiered Leverage Options: Offers appropriate leverage caps based on your account type and trading instrument to limit risk exposure.
If your margin level falls below the stop-out threshold (usually 50% or lower depending on the account), FXTRADING.com may automatically close your positions to prevent further losses. This is to protect your remaining capital and maintain market integrity.
Yes, leverage limits vary by asset class on FXTRADING.com. Some typical examples of leverage limits include:
- Major forex pairs: Up to 500:1
- Minor/exotic forex pairs & commodities: Lower leverage of 100:1 or 200:1
- Indices and cryptocurrencies: Usually even lower due to volatility (e.g., 50:1 or less)
The exact leverage limit depends on instrument type, trading account type, and regulatory jurisdiction.