What is Margin?
Understand margin, margin requirements, and margin calls in forex trading.
Last reviewed: 2026-03-06
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Overview
Margin is the amount of money your broker holds as collateral when you open a leveraged position. It is not a fee—it is the portion of your account that must be available to cover potential losses. When you open a $100,000 position with 100:1 leverage, your broker requires $1,000 in margin (1% of the position).
Margin Requirements
Each broker sets margin requirements based on leverage and the pair you trade. Higher leverage means lower margin per trade. Regulators often cap leverage (e.g. 30:1 for major pairs in some jurisdictions) to protect retail traders. Always check your broker's margin requirements before trading.
Margin Call
A margin call occurs when your account equity falls below the required margin. The broker may close your positions to limit their risk. To avoid margin calls, use stop losses, trade smaller positions, and never over-leverage. Keep a buffer above the minimum margin.
FAQ
Common questions about this topic.
What is margin in forex?
Margin is the collateral your broker holds when you open a leveraged position. It is the amount of your account that must be available to cover potential losses.
What is a margin call?
A margin call happens when your equity falls below the required margin. The broker may close your positions to protect themselves from further losses.
How do I avoid a margin call?
Use stop losses on every trade, size positions conservatively, and keep a buffer above the minimum margin. Never risk more than you can afford to lose.
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Disclaimer and sources
Educational content only. Not financial advice.
Important disclaimer
Forex trading involves substantial risk. Margin amplifies both gains and losses.