How is Margin Calculated? - How to Calculate Margin in Forex Trading

Forex trading margin is calculated based on a percentage. Percent ratio can be 1% margin for 100:1 leverage or 2% margin for 50:1 leverage or 10% margin for 10:1 leverage.

For 1% margin for 100:1 leverage it means

1:100 leverage option means one can borrow $100 dollars from their broker for every $1 dollar in their account:

Therefore, what's the percent of the $1 dollar in a trader's account compared to the $100 dollars borrowed from their broker? it is 1%

1/100*100 = 1% Margin

For 2% margin for 50:1 leverage it means

1:50 leverage option means one can borrow $50 dollars from their broker for every $1 dollar in their account:

Therefore, what's the percent of the $1 dollar in a trader's account compared to the $50 borrowed from their broker? it is 2%

1/50*100 = 2% Margin

For 10% margin for 10:1 leverage it means

1:10 leverage option means one can borrow $10 dollars from their broker for every $1 dollar in their account:

Therefore, what's the percent of the $1 dollar in a trader's account compared to the $10 dollars borrowed from their broker? it is 10%

1/10*100 = 10% Margin

To Learn More about Leverage and Margin - Read the Topics Below:

• What is Leverage

• Forex Leverage & Margin Example

• Forex Leverage Margin Explained

• What is Equity Management

• Forex Equity Management Rules

FX Leverage & Margin Discussed