What's the Difference Between Equity & Margin in CFD?
Equity is the total amount of capital in a cfd trader's account while margin is amount of money required by your cfd broker so as to allow you to continue trading with borrowed amount that you have borrowed after using cfd leverage.
If there are no trades then the equity is equal to free margin - this free margin is the amount available for opening new cfds trades and because there are no open cfds trades then this free margin is equal to the equity in the trader's account.
When a trader opens new trade transactions using part of their equity then the margin used to open trades is known as used margin and the part of their equity that has not been used to open cfds trades is known as free margin.
To Learn & Know More about CFDs Leverage & Margin - How Do I Read the Topics Below:
CFDs Leverage and Margin Guide
