Margin Requirements

  • With the City Index margin calculator, it is possible to calculate margin in real-time based on the currency pair you wish to trade. 

    For non-dollar based currency pairs, the margin required will be converted into US dollars at the prevailing market price for that pair. For example, the margin required to place a trade of GBP 100,000 is not the same as the margin needed for a trade of USD100,000.

    Remember, however, that margin required is affected by changes in the market rate and could fluctuate based on fluctuating currency prices so it is important that you have enough funds in your account to any change in margin requirements.

    We offer margin in real time to give you a much more transparent view of your total risk exposure during the life time of a trade.

    Margin Example

    Say you decide to sell GBP/USD 100,000 at 1.5550 with GBP/USD trading at 1.5550 /1.5551. The leverage selected is 50:1.

    The margin required is GBP100,000 /50 = GBP 2,000. Since this currency pair is not dollar-based, margin must be converted into dollars to correctly reflect the risk.

    GBP 2,000 X 1.55505 (mid-rate of pair traded 1.5550/1.5551) = $3,110.10.

    The margin required to place this trade would be GBP2,000 or $3,110.10.

    Please be aware that this margin is marked-to-market in real time for the life of the trade, which is standard market protocol.

    Therefore, if the GBP/USD mid-price increased theoretically to 1.5750, the margin required to maintain the trade would be GBP 2,000 x 1.5750 or $3,150.00. If the price fell to 1.5350 then the required margin would decrease accordingly.

    * In the event of extreme market conditions, City Index may change spreads and margin requirements. We shall notify you of these changes accordingly.

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