What's XAUUSD Margin?
Margin is the amount of money required by your broker so as to allow you to continue to trade with borrowed amount in your account.
In other words the question what's margin in XAUUSD? can be described as money required to cover open trades and is expressed in percent. For 100:1, the amount you will control is $100,000 if your trading account capital is $1,000.
Now can you compare a investing $1,000 with another one that is investing $100,000? Obviously Not. This is how it works: it takes you as a trader from that retail trader investing $1,000 to the investing $100,000. Where does this extra money come from? - You borrow it from your online broker in what's simply referred to as Gold Leverage. This equity that you as a trader borrow, you borrow it against the $1,000 dollar of your own that you deposit with your online broker when you open a account. If you were to explain what this means - then it is the ability to control a big amount of money using very little of your own money & borrowing the rest. Otherwise, if you were trade XAUUSD without this leverage it would not be as profitable as it is, in fact you can still select not to use leverage, using the 1:1 xauusd leverage option but you would not make money it would take too long to make any profit in xauusd.
Examples of how to calculate Margin:
XAUUSD Margin required in this case is $1,000 (your money) if it's expressed as a percentage of $100,000 which you control it is:
If leverage = 100:1
1,000 / 100,000 * 100= 1%
Gold Margin required = 1%
(1/100 *100= 1%)
How to Calculate Margin - What is Margin?
