What is Margin?

The portion of your balance the broker locks as collateral to keep a leveraged position open — a deposit, not a fee.

Margin is the amount of your own money the broker sets aside as collateral when you open a leveraged position. It is not a cost or a fee — it is a security deposit that returns to your free balance when the trade closes. The amount depends on leverage: at 1:100, controlling a $100,000 standard lot requires $1,000 of margin. Platforms display used margin (locked in open trades), free margin (available for new trades or to absorb losses), and margin level, the ratio of equity to used margin.

Margin becomes dangerous only when traders treat free margin as permission to open more positions. Each new trade locks more collateral and leaves less cushion to absorb the floating losses of normal market movement. When equity falls too close to used margin, the broker issues a margin call and can eventually force-close positions. Professionals size their trades from a written risk plan first, so margin stays a background number — capital efficiency, never a limit they actually approach.