What is Margin?

Margin can be thought of as a good faith deposit required to maintain open positions. This is not a fee or a transaction cost, it is simply a portion of your account equity set aside and allocated as a margin deposit.

The Use of Leverage & Margin

One of the main appealing factors about forex trading is the use of Leverage; Margin.It allows you to use a small amount of capital to open and maintain a much larger position. For example, if you want to open a trade of $100,000 worth of EURUSD, you don't have to have that $100,000 dollars in your account.

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Margin Call and Liquidate

  • 1. Margin Call occurs when equity has dropped to 100% or less, from Margin Requirement (margin required). Notification of margin calls will be sent to customers via automatic messages (popup messages) on the trading platform. Customers are prohibited from adding new positions until the shortage of Equity has been fulfilled.
  • 2.All Margin Calls must be properly fulfilled. Failure to fulfill them may result in liquidation of your existing position without prior notice.
  • 3.If Equity drops to 50% or less from the required margin, the system will automatically liquidate all available positions, whether hedge, based on the next available price without prior notice to the customer.
  • 4.The customer is obliged to meet sufficient margin for overnight positions (Friday market close), including sufficient margin for hedging positions. If the customer's Equity is not enough to maintain overnight positions, then DC has the right to liquidate part or all of the customer's open positions using the last closing price available on the trading platform (depending on the Bid / Ask position), until the equity can meet the sufficient margin for an overnight position.