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Free margin is the available amount in your trading account to open new trades. It is calculated by deducting used margin from equity. It is also called usable margin.<br><br>If you make any profit, your free margin increases and if you make losses, your free margin decreases.
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4/21/25, 3:19 PM What is Free Margin Level in Forex Trading? - SureShotFX Happy Easter Sale. Happy Easter Sale. Ending in Ending in 3d 3d20h 20h What is Free Margin Level in Forex Trading? Home / Forex Basics / What is Free Margin Level in Forex Trading? Free margin is the available amount in your trading account to open new trades. It is calculated by deducting used margin from equity. It is also called usable margin. If you make any profit, your free margin increases and if you make losses, your free margin decreases. https://sureshotfx.com/what-is-free-margin-level-in-forex/ 1/8
4/21/25, 3:19 PM What is Free Margin Level in Forex Trading? - SureShotFX Free margin level in forex trading The amount of money you have in your trading account is your account balance. If you don’t have any open positions or trades, that means your equity is the same as your trading balance. Now if you have an open position, the available amount which you can use to open new positions in the market is called Free margin in Forex. Let me explain with an example. Table of Contents Example of free margin in forex Example 01: Example 02: Example of free margin in forex Let’s say you have a trading account with a balance of $1000. You don’t have any open trades or positions. Now we’ll calculate free margin. https://sureshotfx.com/what-is-free-margin-level-in-forex/ 2/8
4/21/25, 3:19 PM What is Free Margin Level in Forex Trading? - SureShotFX Example 01: 1. First, let’s calculate equity. Equity = Account balance + Profit/Loss As you’re not trading currently and don’t have no open positions, your equity is Equity = $1000 + $0 = $1000 So the equity is the same as the account balance. 2. Now let’s calculate free margin Free Margin = Equity – Used Margin You don’t have any open positions which means you haven’t used any margin yet. So your free margin is Free margin = $1000 – $0 = $1000 Example 02: Now you decided to start trading with your $1000 account balance. You opened a 1 mini lot position with 5% required margin. 1. Your Required Margin = Notional Value x Margin Requirement = $10,000 x .04 2. Now you have opened a position in the market. Your required margin is your used margin. 3. Now your equity is https://sureshotfx.com/what-is-free-margin-level-in-forex/ 3/8
4/21/25, 3:19 PM What is Free Margin Level in Forex Trading? - SureShotFX Equity = Account balance + Profit/Loss = $1,000 + $0 = $1000 4. Now let’s calculate free margin Free Margin = Equity – Used Margin = $1000 – $400 = $600 We also need to note that the profit and loss from the current open positions can also impact free margin in forex. In this article, we’ve covered what is free margin level in forex and how you can calculate it easily. As a new trader, it is really important to know some major concepts of Forex. Free margin in Forex trading is a very significant concept. It is important to understand the concept of margin levels when you’re trading volatile markets like Forex. #equity free margin margin level #free margin #free margin and margin level #Free Margin Level in Forex Trading #what is free margin level in forex PREVIOUS NEXT Understanding Different Lot Sizes in Forex Top 5 Reasons Why Most Forex Traders Fail Leave a Reply Your email address will not be published. Required fields are marked * Comment * https://sureshotfx.com/what-is-free-margin-level-in-forex/ 4/8
