What is Free Margin?
Free Margin is the money that is NOT “locked up” due to an open position and can be used to open new positions.
When Free Margin is at zero or less, additional positions cannot be opened.
Free Margin can be thought of as two things:
- The amount available to open NEW positions.
- The amount that EXISTING positions can move against you before you receive a Margin Call or Stop Out.
Free Margin is also known as Usable Margin, Usable Maintenance Margin, Available Margin, and “Available to Trade“.
Here’s how to calculate Free Margin:
- Free Margin = Equity - Used Margin
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