Margin Level
Margin level is a ratio of your equity to the margin in use, typically equity ÷ used margin × 100%; platforms close positions when it falls below a set level.
Margin level shows how much equity you have compared with the margin your open positions use. It is shown as a percentage. When it falls, brokers may stop you opening trades, issue a margin call and eventually close positions. The trigger levels and close-out rules are set by each broker and differ by country and regulator.
- Category
- Risk Management
- Reading time
- 3 min
- Also called
- Margin level percentage, Margin ratio
- Updated
Margin level in plain words
Margin level is your account equity divided by the margin in use, shown as a percentage.1
It drops as the market moves against your open trades.2
Below 100%, a broker may block new trades and put you on margin call.3
How to check margin level
Find equity
Take your balance plus or minus open gains and losses.
Find used margin
Add up the margin held for all open positions.
Apply the formula
Margin level = (equity / used margin) x 100.1
Compare with your broker's levels
Learn your broker's close-out level so your positions aren't liquidated by surprise.3
Watch it as prices move
Watch it fall as losses on open positions grow.2
Act early
If you get a margin call, add funds right away to avoid forced closure.3
Worked examples
Example 1 — Comfortable level
500%A hypothetical account has equity of 3,000 and used margin of 600.
| Margin level | 3,000 ÷ 600 × 100 = 500% |
Using (Equity / margin used) x 100 = margin level, this made-up account sits at 500%.3
Example 2 — Losses cut the level
150%Open trades lose 2,100, so hypothetical equity falls to 900 with the same 600 used.
| Margin level | 900 ÷ 600 × 100 = 150% |
The adverse move pulled the margin level down.2
Example 3 — Below 100%
Margin call riskFurther losses take hypothetical equity to 540.
| Margin level | 540 ÷ 600 × 100 = 90% |
Under 100%, new trades can be blocked and a margin call issued.3
Margin level vs free margin
| Aspect | Margin level | Free margin |
|---|---|---|
| Unit | Percentage | Money |
| Formula | Equity ÷ used margin × 100 | Equity − used margin |
| Shows | Safety ratio | Room for new trades |
| Trigger use | Margin call and close-out | Opening limits |
Where traders use it
Margin calls
Seeing a Margin Call coming.
Leverage control
Keeping Leverage in check.
Liquidation risk
Avoiding forced Liquidation.
CFD accounts
Monitoring Contract for Difference positions.
Advantages and disadvantages
Advantages
- One number shows account safety.
- Easy to compute.
- Matches the trigger brokers use.
Disadvantages
- Trigger levels differ by broker and country.
- Can drop fast in gaps.
- Says nothing about single-trade risk.
- High level can still hide big open risk.
Going deeper
Read as far as you need. Each level builds on the one before it.
The ratio
Beginner
Equity ÷ used margin × 100 gives the margin level.1
Healthy and unhealthy
Intermediate
Above 100% is generally fine; below it, a margin call becomes possible.3
Close-out rules
Advanced
Each broker sets its own close-out rule, so know it before trading.3 Rules and minimum levels differ by country and regulator.
Common mistakes
Ignoring it until a call
Check it daily.
Assuming one standard
Read your broker's levels.
Adding trades near 100%
Leave a buffer.
Forgetting gaps
Levels can be skipped overnight.
Check your understanding
Test yourself before moving on. Each answer comes with an explanation.
Key points to remember
- Margin level = equity ÷ used margin × 100.
- Losses push it down.
- Below about 100% brokers may issue a margin call.
- Close-out levels are set by each broker.
- Rules differ by country and regulator.
Frequently asked questions
Is a higher margin level better?
Is 100% the same everywhere?
How do I raise it?
Further learning
- Margin
The basics.
- Margin Call
What happens next.
- Leverage
Why margin exists.
- Liquidation
Forced closing.
Sources
This article is written in our own words. The sources below support the specific facts, rules and figures marked with a number in the text. Links open the original publisher’s page.
- CMC Markets. What is Margin in Forex? (opens in a new tab) Checked .
- Alpari. What is free margin and margin level? (opens in a new tab) Checked .
- IG. Using margin in forex trading (opens in a new tab) Checked .
Educational content, not financial advice. Examples use hypothetical prices and simplified costs; actual fees, margin rules and regulations vary by broker, market and country. We are not affiliated with any publisher linked above. Last reviewed . Report an error or request a source credit.