What is margin? Margin can be thought of as a good faith deposit required to maintain open positions. This is not a fee or a transaction cost, it is simply a portion of your account equity set aside and allocated as a margin deposit. Keep in mind that trading on margin can both positively and negatively affect your trading experience as both profits and losses can be dramatically amplified. You can keep track of your Used and Usable margin in the Accounts Window of the Trading Station.
SMART MARGIN WATCHER: MANAGE YOUR TRADING ACCOUNT SMARTER
FXCM is committed to increasing customer profitability. We know that our traders are right more than 50% of the time, however many traders lose more money on losing trades than they make on winning trades.2 FXCM believes that the Smart Margin Watcher feature, one of the newest Trading Station features, can help you stay ahead of Margin Calls and ultimately put you in a better position to trade.
The Smart Margin Watcher was designed to monitor your positions and ALERTS you if the market goes against your trades and your account equity drops below your margin requirements.
Essentially the Smart Margin Watcher can give you a buffer between your Margin Warning and liquidation, allowing you to either deposit more funds or close out of positions to potentially avoid a margin call. To disable FXCM's Smart Margin feature on your account, log into MyFXCM.com and select "Change-Margin Request". Please note that the Smart Margin Watcher is only available on FXCM LLC Trading Station accounts at this time.
How does FXCM calculate margin?
By default FXCM LLC offers a maximum of approximately 50:11 leverage (or 2% margin) on its forex trading accounts. Margin requirements (per 1K lot) at FXCM are determined by taking a percentage of the notional trade size plus a small cushion. A cushion is added to help alleviate daily/weekly fluctuations.
Please note that margin requirements are subject to change without notice based on price fluctuations and will be adjusted up or down in increments of $1. We believe that margin requirements will not change more than once a month. See the table below for margin requirements on an FXCM LLC Account using a 1K lot size. Up-to-date margin requirements are displayed in the "Simplified Dealing Rates" window of the Trading Platform by currency pair.
Major Currency Pairs
2% Margin (50:1 leverage)
|$10 Margin||$20 Margin||$24 Margin||$30 Margin||$36 Margin|
Exotic Currency Pairs
5% Margin (20:1 leverage)
|Exotic (Variable) Margin|
|USD/MXN ($50)||SGD/JPY ($50)|
|EUR/PLN ($75)||USD/TRY ($50)|
|USD/PLN ($50)||EUR/TRY ($75)|
|EUR/CZK ($75)||USD/RUB ($50)|
|USD/CZK ($50)||EUR/HUF ($75)|
|USD/ZAR ($50)||USD/HUF ($50)|
|USD/SGD ($50)||TRY/JPY ($37.50)|
|HKD/JPY ($12.50)||ZAR/JPY ($12.50)|
|USD/HKD ($50)||USD/ILS ($50)|
1 Leverage: Leverage is a double-edged sword and can dramatically amplify your profits. It can also just as dramatically amplify your losses. Trading foreign exchange with any level of leverage may not be suitable for all investors.
2 According to a 2011 study in "Traits of Successful Traders" conducted by the DailyFX research team.