What Is
Used Margin?
Learn what used margin means, how it's calculated, and why it represents committed rather than spent capital.
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Used margin is the starting point for understanding the broader margin framework covered in this unit. This guide explains what it means and how it's generally calculated.
This is general educational content; specific margin requirement percentages vary by broker and instrument.
What Is Used Margin?
Used margin (also called required margin) refers to the amount of capital currently committed by your broker to maintain your open positions. It represents the sum of the margin requirements across all currently open trades.
How Used Margin Is Generally Calculated
Margin required for a single position is generally calculated as: Position Value × Margin Requirement Percentage, where the position value reflects the size of the trade and the margin requirement percentage is set by the broker (which is also directly connected to leverage, as covered in the What Is Leverage lesson earlier in this module). For example, a $100,000 position with a 1% margin requirement would require $1,000 in used margin.
Used Margin Is Committed, Not Spent
It's important to understand that used margin is not a cost or fee — it's capital that remains part of your account but is set aside and unavailable for opening additional positions while the related trade remains open. Once a position is closed, its corresponding used margin is released back into your available funds.
Multiple Positions and Combined Used Margin
When multiple positions are open simultaneously, used margin reflects the combined total across all of them. This connects to the earlier lesson on risk exposure across multiple positions, since opening additional positions increases total used margin, correspondingly reducing available free margin, covered in the next lesson.
🔖 Summary
Used margin is the capital currently committed by your broker to maintain open positions, calculated from position value and the margin requirement percentage, and directly connected to leverage. It represents committed rather than spent capital, released back to available funds once a position is closed.
Frequently Asked Questions
What is used margin?
It's the amount of capital currently committed by your broker to maintain your open positions, calculated from position value and the margin requirement percentage.
Is used margin a cost or fee?
No, it's committed capital that remains part of your account but is unavailable for new positions while the related trade is open; it's released when the position closes.
How is used margin calculated for a single position?
Generally as Position Value × Margin Requirement Percentage, which is directly connected to the leverage offered for that instrument.
What happens to used margin with multiple open positions?
It reflects the combined total across all open positions, meaning more open positions increase total used margin and reduce available free margin.
Risk Warning
Trading forex and CFDs involves significant risk and may not be suitable for all investors. You may lose all of your invested capital. Please ensure you fully understand the risks before trading.
GTCFX operates as a multi-regulated group of companies, clients are kindly advised to confirm the specific legal entity, regulation, and jurisdiction under which they are being onboarded.
