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Risk management

Margin level

By Jarosław Wasiński • Published: • Updated:
Account equity expressed as a percentage of used margin: margin level = equity ÷ used margin × 100%, when used margin is positive. Brokers may use this ratio for margin warnings and forced closeout.
Example. USD 1,200 equity and USD 400 used margin give a margin level of 300%. If equity falls to USD 600 while margin stays USD 400, the level is 150%. Neither percentage is a universal safe threshold.

Read the denominator

Margin level can fall because equity decreases or required margin increases. With zero used margin, the ratio is undefined; a platform may display a blank or another special value instead of a meaningful percentage.

Common mistake

A margin level of 100% does not mean the account has lost 100%. It means equity equals used margin. Warning and liquidation thresholds, and the positions closed first, depend on the account’s rules.

Apply it

Compare the displayed ratio with the actual margin-call and stop-out policy. Do not treat the distance to closeout as a stop-loss budget. MetaTrader 5 account-field documentation.

FAQ

Can margin level fall with no large price move?

Yes. Used margin can increase, while fees or other account adjustments can change equity.

What is margin level with no used margin?

The ratio has a zero denominator and is undefined. A special platform display is not a meaningful percentage.

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Put this term into practice

Use your broker’s contract specifications and current exchange rates. Calculators illustrate assumptions; they do not guarantee execution prices or returns.

Jarosław Wasiński

Editor-in-chief, ForexMechanics.com • Macro & FX analyst

Independent analyst and practitioner with over 20 years of experience in financial markets. Actively involved in Forex since 2007, with a focus on fundamental analysis, OTC market structure, and disciplined capital risk management.

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