Margin – Margin Call

The balance means the real money that we’ve invested, our capital without the additional margin or leverage that is allowed under the trading platform:

The equity is the true, current balance, excluding ongoing trades:

Let’s say that the balance is $10,000 that we’ve invested, and  we’ve got several trades in a winning position, meaning that if they are profitable by $2000, the balance will be $10,000 in value, and the equity will be:

Used margin means how much money I’m actually using from the allowed margin based on my account balance:

The usable margin is how much additional money I can use in order for me to close more positions:

For example, if my balance is $10,000, my ongoing trade profit equals $2,000. I have opened a position equivalent to $300,000 with 100 times leverage. My available leverage balance, that is, the usable margin, is an additional $9,000 that will allow me to use the exposure of up to […] using leverage:

Usable margin isn’t a term for a total capital you can use freely, but how much money you’ve got in total, meaning the difference between your current balance and the used capital:

Let’s say that we are dealing with a new account, and we’ve invested $5000, and the equity without trading is $5000 as well. So, we can use […] of leverage for us to open a position or several positions:

Reaching a margin call, the trading platform will not close our positions automatically:

Usually, the margin call threshold is around […] of protection: