Margin starts at 0% usage. Every trade adds to the margin usage. Once the margin goes above 100%, the client cannot place new orders. Any order that would put the client above 100% margin usage is rejected.
Free Cash : Positive Cash Balance – Negative Cash Balance - Cash blocked
Account Value : Positive Cash Balance – Negative Cash Balance + Cash Product Value + Margin Product Unrealized Profit – Margin Product Unrealized Loss
Margin Available : Free Cash + Margin Product Unrealized Profit – Margin Product Unrealized Loss
Margin Used : Cash Product Value + Cash blocked
Note : Cash can be blocked for Margin, for Payment or Corporate Actions requests
Required Margin calculation :
Every time a client places a new trade, the behavior will be different based on the product type :
- Cash Product: The client will pay the full cash value (the amount is removed from the client cash account), and the value of the asset will be added to the Margin Available and to the Margin Used (100% margin usage).
- Margin Product: Margin is calculated based on the leverage associated to the product. Once the trade is done, the margin value is added to the margin usage. The unrealized profit (if any) is added to the Margin Available. The unrealized loss (if any) is added to the Margin Used.
Calculation of the required margin on trade is as follow :
Required Margin: Amount x Leverage
Order Margin: Margin is calculated on orders. Preventing clients from placing orders that would go above 100% margin usage.
NOPs or Net Open Positions :
There are automatic limits on certain Asset Classes regarding the maximum amount a client can hold at one time. These limits are only for CFD / FX CFD / Options / Futures. There exist three types of limits :
- Instrument margin: Limits the quantity that can be held at any time by a client of a specific instrument. Note: Quantities are grossed up. Meaning, positive value, and negative value are not netted they are added.
- Asset Class margin: Limits the quantity that can be held at any time by a client of a specific asset class. When this limit is triggered, the client cannot buy any additional asset within the specified asset class and must close some positions to remove the limitation.
- Client margin: Limits the quantity that can be held at any time by a client. When this limit is triggered, the client cannot buy any additional asset within the 4 asset classes targeted by limits and must close positions to remove the limitation.