Margin Formula

The mathematical formula for calculating required trading margin.

The Formula

Margin = (Lots x Contract Size x Entry Price) / Leverage
Free Margin = Account Balance - Used Margin

Worked Example

Margin Example (EURUSD)

1 lot EURUSD at 1.1000, Leverage 1:100
Margin = (1 x 100,000 x 1.1000) / 100 = $1,100
For XAUUSD at $2,650, 1 lot, 1:100 leverage:
Margin = (1 x 100 x 2650) / 100 = $2,650

Python Implementation

from gfil_calculators.position_size import calculate_margin
result = calculate_margin('EURUSD', 1.0, 1.1000, 100)
print(f"Required margin: ${{result['margin']}}")

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