Forex margin calculator with leverage

How to use it

1. Pick the instrument: a forex pair, gold, silver, an index, oil, bitcoin or ether. Futures are not included, because their margins are set by the exchange and the broker, not by a leverage ratio. 2. Choose your account currency. 3. Enter the size in lots and today's price. 4. Check the contract size. It is filled in for you and can be changed, because metal, index and crypto lots differ between platforms. 5. Enter the account's leverage, for example 1:100, and your equity.

If the price is in a currency other than your account's, the tool shows the exchange rate it uses, filled in from the European Central Bank's daily reference rate with its date. You can type today's rate instead.

What the result means

• Exposure is the full value of the position in your account currency: lots, times the contract size, times the price, converted if needed.
• Required margin is the exposure divided by the leverage. It is set aside while the trade is open.
• Effective leverage is the exposure divided by your equity. It shows how large the position is compared with your money, whatever the account allows.
• Margin level is your equity divided by the margin in use, as a percentage. The lower it goes, the closer you are to a margin call or a stop out.
• Free margin is your equity minus the margin in use: what is left to open other trades.

Worked example: gold

You want 0.10 lots of gold (XAUUSD) at $4,000 an ounce in a USD account with $10,000 of equity. The contract size is 100 ounces a lot and the account allows 1:20 on gold.

1. Exposure: 0.10 times 100 ounces times $4,000 is $40,000. 2. Required margin: $40,000 divided by 20 is $2,000. 3. Effective leverage: $40,000 divided by $10,000 is 4 times. 4. Margin level: $10,000 divided by $2,000 is 500%. 5. Free margin: $10,000 minus $2,000 is $8,000.

The same 0.10 lots at 1:100 would need only $400 of margin, but the exposure and the effective leverage stay the same. A $10 move in gold is still $100 on this position either way.

Common mistakes

• Treating leverage as risk. Leverage decides the margin, not the loss. Your stop and your size decide the loss, so set them first with the lot size calculator.
• Reading 1:100 as your real leverage. The account limit is a ceiling. Effective leverage is what your open positions actually use.
• Using an old price. Exposure and margin move with the price. When the price rises, the same lots need more margin.
• Forgetting the conversion. On a cross or an index priced in euros or pounds, the exposure must be converted into your account currency.
• Ignoring margin level until it is low. A falling margin level with losing trades open can trigger a stop out before your stop is hit.
• Assuming one leverage for everything. Gold, indices and crypto often have lower leverage than major forex pairs.

What to check at your firm

• Leverage by instrument. Prop firms and brokers set their own leverage, and it is often lower on metals, indices and crypto.
• Simulated accounts. Most challenges run on simulated trading accounts, and they still apply leverage and margin as a live account would.
• Margin call and stop out levels. The margin level at which the platform starts closing positions differs by firm.
• Weekend and news changes. Some firms lower leverage over weekends or around major releases.

To see what each pip of the position is worth, use the pip value calculator. To check a trade against today's daily limit as well, use the trade planner. For sizing terms, see lot size.

Results depend on the inputs you enter, and firms' rules differ, so check your own firm's rules before you trade.

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