Margin Trading in Forex: How Margin Works In 2026
BY TIOmarkets
|March 11, 2026Margin is the mechanism that makes leveraged forex trading possible. It is the deposit your broker requires before you can open a position, and it is the figure that determines how much of your account is tied up in open trades at any given moment.
Understanding what margin is, how it is calculated, and what happens when it runs low is one of the most practical things you can do before trading with leverage.
A margin calculator often helps here.
This guide explains how margin works in forex, how it is structured at TIOmarkets, and what the key terms mean in practice.
What Is Margin in Forex Trading?
Margin in forex trading is the amount of funds your broker requires you to set aside when you open a leveraged position. It is not a transaction fee and it is not lost when you place a trade. It is a portion of your account equity that is held as collateral against your open position for as long as that position remains open.
When you close the trade, the margin is released back into your available funds. If the trade moves against you and your losses reduce your account equity, the margin held as collateral does not absorb those losses directly. Instead, losses are deducted from your overall account equity, and the margin requirement stays in place until you close the position.
The size of the margin required depends on two things: the notional value of the position you are opening, and the margin requirement percentage for the instrument you are trading.
How Required Margin Is Calculated
Required margin is calculated as a percentage of the full notional value of the trade. The formula is straightforward: required margin equals notional value multiplied by the margin requirement percentage.
For a forex trade, the notional value is the lot size multiplied by the contract size. For most forex pairs, the contract size is 100,000 units of the base currency per standard lot, confirmed from the TIOmarkets contract specifications.
Taking EURUSD as an example. A 1.0 standard lot represents EUR 100,000. At a rate of 1.10 EURUSD, that position has a notional value of approximately USD 110,000. At a 1% margin requirement, the required margin is approximately USD 1,100. At 0.10 lots the notional value is approximately USD 11,000 and the required margin is approximately USD 110. At 0.01 lots the required margin is approximately USD 11.
The exact required margin will vary with the prevailing exchange rate and your account base currency. For non-USD base currency accounts, the margin amount will be converted at the prevailing rate.
Margin Requirements by Instrument at TIOmarkets
Different instruments carry different margin requirements. For most major and minor forex pairs at TIOmarkets, the margin requirement is 1%, confirmed from the TIOmarkets contract specifications. This corresponds to leverage of up to 1:100 at that margin level, though higher leverage is available depending on account type.
Some instruments carry higher requirements. Pairs involving the Swiss Franc, including USDCHF, AUDCHF, CADCHF, CHFJPY, EURCHF, GBPCHF, and NZDCHF, carry a 5% margin requirement, confirmed from the TIOmarkets contract specifications. USDCNH and USDHKD carry a 10% margin requirement, also confirmed from the TIOmarkets contract specifications.
For commodities and indices, margin requirements differ from forex and vary by instrument. For stock CFDs, the margin requirement is 5% (1:20 leverage). For cryptocurrency CFDs, the margin requirement is 10% (1:10 leverage). All margin requirements are subject to change depending on market conditions and applicable regulatory requirements.
Understanding Your Margin Balance: Equity, Used Margin and Free Margin
When you have open positions, your account displays several margin-related figures. Understanding what each one means helps you manage your exposure.
Equity is your account balance adjusted for the unrealised profit or loss on your open positions. If your trades are currently in profit, equity will be higher than your balance. If they are in loss, equity will be lower.
Used margin is the total margin currently held as collateral across all your open positions. This amount is not available for opening new trades while those positions remain open.
Free margin is the difference between your equity and your used margin. It is the capital available to open new positions or to absorb further losses on existing ones. As open positions move against you, your equity falls, your free margin falls with it, and the gap between your equity and your used margin narrows.
Margin level is expressed as a percentage and calculated as equity divided by used margin, multiplied by 100. It is the figure your broker uses to determine whether you are approaching a margin call.
Margin Call and Stop Out at TIOmarkets
TIOmarkets applies defined margin call and stop out levels across all account types.
The margin call level is 100%. This means when your margin level (equity divided by used margin) falls to 100%, you will receive a margin call alert. At this point your equity equals your used margin and your free margin is effectively zero. You can no longer open new positions and you should consider reducing your exposure or depositing additional funds.
The stop out level is 30%. If losses continue after the margin call and your margin level falls to 30%, the platform will begin closing your open positions automatically, starting with the largest losing position, until your margin level recovers above the stop out threshold. This process continues until sufficient positions have been closed.
One exception applies: on the Standard account when using 1:2000 leverage, the stop out level is 40% rather than 30%.
These levels are subject to change depending on market conditions and applicable regulatory requirements.
Margin on the Standard Account: The Unlimited Leverage Model
The Standard account at TIOmarkets operates differently from a conventional margin account when the unlimited leverage feature is selected. Rather than applying a fixed margin percentage, the model scales margin requirements dynamically based on account equity, confirmed from the TIOmarkets unlimited leverage page.
For account equity between USD 0 and USD 999, no margin is required. For equity between USD 1,000 and USD 2,499, a 0.05% margin requirement applies. For equity between USD 2,500 and USD 4,999, a 0.1% margin requirement applies. For equity between USD 5,000 and USD 19,999, a 0.2% margin requirement applies. For equity of USD 20,000 or more, a 0.5% margin requirement applies.
The practical limit on position size under this model is that the combined pip value of all open positions cannot exceed your available account equity, minus commissions. This means a one-pip adverse movement across all open positions could result in a loss equal to your entire account equity at the maximum position size.
Two restriction periods apply. A 0.5% margin requirement is imposed for positions opened from 15 minutes before to 5 minutes after high-impact news announcements, limiting leverage to 1:200 during that window. A 0.5% margin requirement also applies for positions opened from 21:00 Friday to 01:00 Monday, MetaTrader server time, also limiting leverage to 1:200. Margin returns to your account when each restriction period ends.
Only symbols with a "un" suffix in MT5 are eligible for the unlimited leverage feature. No positive swaps are available on those symbols. EA trading is not compatible with the unlimited leverage feature. The feature is available on the Standard account via MT5 only and is not available on Raw, VIP Black, or Nano accounts.
How Margin Interacts With Position Sizing
Margin requirements have a direct bearing on how many positions you can hold simultaneously and at what size. With a fixed account balance, a higher margin requirement per trade means less free margin remains available for additional trades.
Consider an account with USD 1,000 in equity and no open positions. On a Standard account using 1% margin for EURUSD, opening a 0.10 lot position (notional value approximately USD 11,000 at 1.10 EURUSD) would require approximately USD 110 in margin. That leaves approximately USD 890 in free margin for further positions or to absorb adverse price movements. Opening a 1.0 lot position at the same margin rate would require approximately USD 1,100, which already exceeds the USD 1,000 account equity, making the trade impossible without sufficient balance.
The maximum lot size per individual trade at TIOmarkets is 20 lots across all account types. The maximum number of open and pending orders per client is 200.
Margin and Trading Costs
Margin itself is not a cost. It is returned when you close your position. The costs associated with margin trading are the spread, commission where applicable, and overnight swap charges on positions held past the daily rollover.
On Raw and Nano accounts, commission is charged at USD 6 per round turn lot. The full commission is charged when you open the position and covers both the opening and closing of the trade. On Standard and VIP Black accounts, no commission is charged.
Spreads are variable and typically higher than minimum figures shown. Swap rates are credited or debited for positions held overnight and scale with lot size. For current swap rates, check the contract specifications inside the MT4 or MT5 platform.
Trading Margin at TIOmarkets
TIOmarkets operates the tiomarkets.com domain under a MISA-regulated entity based in the Seychelles. Margin trading is available across all four account types on MT4 and MT5, with the Standard account offering a dynamic margin model via the unlimited leverage feature on MT5. Margin call is set at 100% and stop out at 30% across all accounts, with the noted exception for 1:2000 leverage on the Standard account. Hedging is supported on all accounts. An Islamic (swap-free) account is available for traders who require it; contact TIOmarkets to confirm eligibility and supported instruments.
FAQ
Risk disclaimer: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Never deposit more than you are prepared to lose. Professional client’s losses can exceed their deposit. Please see our risk warning policy and seek independent professional advice if you do not fully understand. This information is not directed or intended for distribution to or use by residents of certain countries/jurisdictions including, but not limited to, USA & Countries included in the OFAC sanction list. The Company holds the right to alter the aforementioned list of countries at its own discretion.
TIOmarkets offers an exclusively execution-only service. The views expressed are for information purposes only. None of the content provided constitutes any form of investment advice. The comments are made available purely for educational and marketing purposes and do NOT constitute advice or investment recommendation (and should not be considered as such) and do not in any way constitute an invitation to acquire any financial instrument or product. TIOmarkets and its affiliates and consultants are not liable for any damages that may be caused by individual comments or statements by TIOmarkets analysis and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his/her investment decisions. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances, or needs. The content has not been prepared in accordance with any legal requirements for financial analysis and must, therefore, be viewed by the reader as marketing information. TIOmarkets prohibits duplication or publication without explicit approval.
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