Risk & Money ManagementRequired MarginMargin in Use
Used Margin
The total collateral currently locked across all open positions and pending margined orders.
What Used Margin means
Used margin is the sum of the individual margin requirements of every open position on an account. Each position contributes its own notional value divided by the applicable leverage ratio, and the platform aggregates them into a single figure. On hedging accounts, offsetting long and short positions in the same instrument may attract a reduced or zero combined requirement depending on broker policy, whereas netting accounts simply collapse the two into one smaller position and charge margin on the residual.
The figure is recalculated whenever a position is opened, closed, partially closed or resized, and it also moves when the broker changes an instrument's margin percentage or when currency conversion shifts the value of a requirement quoted in a foreign denomination. Traders who monitor only their profit and loss can be caught out when a routine tier change or a pre-weekend increase in requirements pushes used margin higher and drags the margin level down without any adverse price movement at all.
Worked example
An account holding one standard lot and one half lot of EUR/USD at 1.0850 under 1:30 leverage locks about 3,617 dollars for the first position and 1,808 dollars for the second, giving used margin of roughly 5,425 dollars.
Related terms
- Free MarginThe portion of equity not tied up as collateral, available to open new positions or absorb losses on existing ones.
- MarginThe portion of account equity a broker sets aside as collateral to open and maintain a leveraged position.
- Margin LevelEquity divided by used margin, shown as a percentage; the ratio brokers monitor to decide margin calls and stop outs.
- LeverageThe ratio between the notional size of a position and the margin a trader must post to open and hold it.
- EquityThe live value of a trading account: balance plus the floating profit or loss of every open position.
Frequently asked questions
What does Used Margin mean in forex trading?
The total collateral currently locked across all open positions and pending margined orders.
How does Used Margin work in practice?
The figure is recalculated whenever a position is opened, closed, partially closed or resized, and it also moves when the broker changes an instrument's margin percentage or when currency conversion shifts the value of a requirement quoted in a foreign denomination. Traders who monitor only their profit and loss can be caught out when a routine tier change or a pre-weekend increase in requirements pushes used margin higher and drags the margin level down without any adverse price movement at all.
What is an example of Used Margin?
An account holding one standard lot and one half lot of EUR/USD at 1.0850 under 1:30 leverage locks about 3,617 dollars for the first position and 1,808 dollars for the second, giving used margin of roughly 5,425 dollars.
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