CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail client accounts lose money when trading in CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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What is margin level and how is it calculated?
Margin level in trading is the ratio of account equity to used margin, expressed as a percentage. It indicates account safety, with higher levels being safer and lower levels risking margin calls or stop-outs. Calculated as (equity/used margin) × 100%, equity includes deposits and unrealized profits or losses.
Formula
Margin level = (Equity / Used Margin) × 100%
Key terms
Term
Meaning
Equity
The total real-time value of your account, including unrealized profit or loss from open positions.
Used margin
The amount of margin currently being used to maintain open positions.
Margin level
The percentage ratio between equity and used margin.
What margin level indicates
Margin level condition
Meaning
Higher margin level
The account generally has more available margin buffer.
Lower margin level
The account may be closer to margin call or stop-out conditions.
Very low margin level
Open positions may be at risk of forced closure if the stop-out level is reached.
Important notes
Margin level changes as market prices move.
Floating profit or loss affects equity and therefore affects margin level.
A lower margin level indicates higher account risk.
Margin call and stop-out are based on margin level, not balance alone.
