Margin Calculator
Calculate required margin, free margin and how much of your account a leveraged position uses.
Calculation Results
For education only. Not financial advice. Trading involves substantial risk of loss.
Leverage lets you control a position larger than your account balance by putting up only part of its value as margin. Enter the price, quantity, leverage, and your balance to see how much margin a trade needs and how much of your account it uses.
The formulas
- Position value = Price × Quantity
- Required margin = Position value ÷ Leverage
- Effective leverage = Position value ÷ Account balance
Worked example
Price $100, 500 units, 10x leverage, $10,000 balance:
- Position value: $50,000
- Required margin: $5,000
- Free margin: $5,000
- Effective leverage: 5x
Margin is not your risk
Margin is the deposit your broker holds. Your loss depends on the full position value. In the example, a 10% adverse move loses $5,000, which is all of the margin and half of the account. Set a stop-loss well before that, and size the trade with the position size calculator.
Common mistakes
- Maxing out available leverage. A high maximum does not mean you should use it.
- Ignoring free margin. Low free margin can force your broker to close positions in a fast market.
- Stacking positions. Several trades on correlated assets use margin at once and share the same risk.
FAQ
What is a margin call? A demand or automatic action when your equity falls too low against required margin. Rules differ by broker.
Is effective leverage different from account leverage? Yes. Account leverage is the maximum allowed. Effective leverage is what you actually use.
Related tools: Liquidation Price Calculator · Position Size Calculator · All trading tools
Trading with leverage can result in losses greater than your deposit with some products. Not financial advice.
