What is difference Used Margin and Usable Margin in Forex?

9:59 AM |

Used Margin is the amount you set aside to keep trades open. It is like a good faith deposit.

Usable Margin is what you have leftover in your account to guard against losses on the trade.

You will receive a margin call when your usable margin goes to 0. How does Usable Margin decrease? This can happen one of two ways. 1) Losses on an open position will decrease your usable margin. 2) Opening new positions will set aside more of your usable margin as used margin.

Here's an example supposing you start with $5,000 in your account. You open a trade using which requires $1,000 in Used Margin. This leaves you with $4,000 in Usable Margin. If you sustain $4,000 in losses on your open trade, a margin call will occur.
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