Posts Tagged ‘Margin trading’

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What Is Margin in Forex Trading?

In this video, you will learn about how to use margin in forex trading. Margin is the amount locked from your trading capital for a given open position in the market. Higher the leverage, smaller the amount needed as margin to be allocated for a given open trade. However, your risk increases as you increase the leverage. For example, if you want to trade the EUR/USD pair, and you want to place a one standard lot position. […]

What Is Margin Trading? How Does It Work?

In this video, you will learn about margin trading, its advantages, and disadvantages. Margin trading is done through leverage. You can trade a bigger lot size using a small capital using leverage. Suppose, your broker offers you 1:100 leverage. Then you can control 100 times of what your margin size is. Your margin is the amount allocated for each trade. Margin trading […]

How to Calculate Margin?

In this video, you will learn how margin is calculated for each single trade you place with your broker. Forex brokers offer different leverages and you can choose one according to your risk appetite. Assume, you have chosen 200:1 as leverage, and you have 1000 USD in your trading account as initial investment. Suppose, you want to purchase 1 lot of EUR/USD. One lot is […]

Forex — What Are Margin Requirements?

Margins and margin requirements can be incredibly small compared to the level of currency controlled by a trader in any one trade. Leverage allows many multiples of the margin deposit to be traded with the effect of increasing both rewards and risks in the process. The profits are far greater and can be realized by traders who do not possess such a large trading account. However, margin also acts as a stop-loss and the point at which brokers will […]

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