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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

XTB Online Trading

Margin Level

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Glossary
Reading time: 1 minute(s)
The margin level is a risk management indicator that helps you understand the influence of the currently opened positions on your account.

Table of contents

  • The margin level is a risk management indicator that helps you understand the influence of the currently opened positions on your account.
  • Margin level is a mathematical equation that effectively tells the trader how much of their funds are available for new trades.
  • The higher the margin level, the higher the amount of cash available to trade.
  • The lower the margin level, the lower the amount of cash available to trade, and this is where an account could be subject to a margin call.

How is margin level calculated?

It is calculated with the following formula:

Margin level = equity/margin x 100%

If you don't have any trades open, your margin level will be zero. Once a position is opened, the margin level will depend on several factors such as:

  • Volume
  • Type of market
  • Leverage

Margin level example

The xStation platform automatically calculates your margin level and you can view it at the bottom of your screen.

Margin.png

Source: xStation

In the example above, the margin level is calculated in the following way:

Margin level = 103490.38/2500 x 100% = 4139.62%

This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.

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