What is margin?
The amount of cash deposit required in a clients account in order to open a position or to maintain an open position. Margin is essentially collateral for a position. If the market moves against a customer’s position, the client will be requested to deposit additional funds through a “margin call.” If there are insufficient available funds, IFX Markets will immediately close out the client’s open positions.
The amount of cash deposit required in a clients account in order to open a position or to maintain an open position. Margin is essentially collateral for a position. If the market moves against a customer’s position, the client will be requested to deposit additional funds through a “margin call.” If there are insufficient available funds, IFX Markets will immediately close out the client’s open positions.
Margin is a performance bond, or good faith deposit, to ensure against trading losses. The margin requirement allows you to hold a position much larger than your actual account value. Most forex brokers’ online trading platforms perform automatic pre-trade checks for margin availability, and will only execute the trade if you have sufficient margin funds in your account. These systems also calculate the funds needed for current positions and displays this information to you in real time. In the event that funds in your account fall below margin requirements, some or all of your open positions will be closed. This prevents your account from ever falling below the available equity even in a highly volatile, fast moving market.
