Gold Leverage & Margin, Margin Required, Equity, Used XAUUSD Margin and Free margin

Margin required : It is the amount of money your xauusd broker requires from you to open a position. It is expressed in percents.

Equity : It's the total amount of capital you have in your trading account.

Used margin : amount of money in your account which has already been used up when buying a xauusd lot, this contract is the one that is displayed in open positions. As a trader you can't use this amount of money after opening a trade because you have already used it & it is not available to you.

In other words, because your xauusd broker has opened up a position for you using the capital you have borrowed, you must maintain this usable margin for your trading account as a security to allow you to continue using this xauusd leverage he has given you.

Free margin : amount in your account that you can use to open new trades. This is the amount of money in your trading account that has not yet been xauusd leveraged because you have not yet opened a trade with this money - this money also is very important for you as a trader because it enables you to continue holding your open trades as will be explained below.

However, if you over use xauusd leverage, this free margin will drop below a certain percent at which your xauusd broker will have to close all your positions automatically, leaving you with a big loss. Xauusd broker at this point closes all your position because if your positions are left open they would lose the money you have borrowed from them.

This is why you should always make sure you've a lot of free margin. To do this never trade more than 5 percentage of your gold account, in fact 2 percent is recommended.