What are the Initial, Maintenance, and Liquidation Margin Requirements?
In Canada, the Investment Industry Regulatory Organization of Canada (IIROC) is the national self-regulatory organization that set the margin requirements needed, which may be changed at any time without notice. The calculation of the margin requirements is dependent on the currency pair of choice, as well as the currency that the account is denominated in.
Learn More About Margin Requirements
The definition of each margin requirement is below:
Initial Margin:
This is the amount required to open a new position.
Maintenance Margin:
This is the minimum amount required to maintain your open positions. If your account equity falls below the Maintenance Margin level (Usbl Maint Mr = 0), you will receive a Maintenance Margin Warning at which point you will no longer be able to place new trades. You will have approximately five days from 17:00 ET on the day that the Margin Warning Status is initiated to bring your account equity back above this level. You can elect to add additional funds to your account or close existing positions to bring your account equity above the required Maintenance Margin level. Note that it is also possible that beneficial market movements during this period may also bring your account equity above the required Maintenance Margin level. If you fail to do so, your positions will be triggered to liquidate at the end of the fifth day. Should your equity continue to fall to the Liquidation Margin Level, your positions will be automatically liquidated.
**Please note that weekends and bank holidays will count against the five days you are given to bring the account equity above the Maintenance Margin Requirement. See below for details on when positions will be triggered to liquidate on the fifth day of a Margin Warning.
Liquidation Margin:
The Liquidation Margin is typically*** equal to 10% of the Initial/Maintenance Margin. If your account falls to the Liquidation Margin level, all of your open positions will be triggered to immediately be liquidated, even though you may still be in the five day grace period offered by the Maintenance Margin Warning.
Up-to-date margin requirements are displayed in the “Simplified Dealing Rates” window of the Trading Station by currency pair.
