Margin

Margin is the collateral your broker requires to open and hold a leveraged trading position. It is expressed as a percentage of the full position size, which directly corresponds to your leverage ratio. With a 1 percent margin requirement (equivalent to 100:1 leverage), you need $1,000 in your account to open a $100,000 position. Margin is not a cost or fee, it is a deposit held against the position while it is open and returned once the trade closes.

Your account tracks several related figures that all depend on margin. Used margin is the total amount locked up by your open positions. Free margin is the difference between your equity and used margin, representing capital available for new trades or to absorb floating losses. Margin level is the ratio of equity to used margin, expressed as a percentage, which brokers use to determine margin calls and stop outs.

For example, if you open 1 standard lot of EUR/USD at 1.0850 with 100:1 leverage, the required margin is roughly $1,085 (1 percent of the $108,500 notional value). If your account has $10,000 of equity, that leaves $8,915 of free margin for additional trades or to absorb drawdown. If floating losses reduce your equity toward the used margin level, your margin level percentage drops, potentially triggering a margin call around 100 percent or an automatic stop out around 50 percent depending on the broker.

In copy trading, margin management is critical because multiple positions may be open simultaneously. SteadyFlowFX's 9 algorithms may take several concurrent trades across the 8 pairs, consuming cumulative margin. The system's position sizing is designed to keep total margin usage within prudent limits, supporting the verified Myfxbook 34.2 percent max drawdown. Checking your broker's margin calculator and leverage setting before connecting a copy trading account helps ensure the strategy can execute all signals without running into margin constraints.