Margin and leverage FAQs

Margin is the amount of money you need to deposit with us to place a trade and maintain that position. The margin required is typically a percentage of the value of your trade. 

When you place the trade you must have enough net equity (cash and unrealised profit & loss) in your account to cover the margin requirement for that trade and the commission (if applicable) and/or any charges, including the spread. Margin is not a fee; it is deducted from your account and returned when the position is closed. 

Learn more about margin and leverage. 

Our margin levels differ according to market, asset class and position size. You can find out the specific margin of each instrument in the market information sheet on your trading platform. 

To calculate the amount of funds required to cover the margin when you open a trade, simply multiply the total notional value of your trade (stake x price of instrument) by the margin factor. 

For example, say Vodafone share’s margin requirement is 20%. The current buy price of Vodafone is 200p and you wish to spread bet £10 a point. 

The total value of the position is £2000 (£10 x 200). £400 would therefore be allocated from your account to open the position (£2000 x 20%). 

With StoneX Trading’s Web Trader platform, you can calculate your margin before placing a trade through the platform’s margin calculator, monitor each position’s margin requirement* separately or review your account’s total margin requirement through the “margin level indicator”. 

*We reserve the right to change our margin requirements at any time in accordance with our terms and conditions of business. 

To find out more about how margin works, please visit our education section. 

The larger the trade size, the higher the risk level associated with the trade. Therefore, we may increase our margin requirements for larger size trades or any additional trades in that instrument. To do this, StoneX Trading increases the size of the margin requirement at specific levels, known as 'step margin levels'. 

For example, in Company ABC 

*Margins may vary by individual equity, please see market information sheet for full details. 

As a retail client, if you were to place a trade in company ABC at £5 per point, you would be charged an initial margin of 20%. If you were to place an additional buy spread bet of £12 per point in the same market, your total stake size in that market would now be £17 per point. 

This means that, for your total spread bet position in this market, the first £10 per point is charged at the initial step margin of 20%. The remaining £7 per point is charged at the second step margin of 30%. The same would be true of a CFD position. 

Step margins are not applicable for trading on MT4. 

Hedging margins are set to the 'longest leg' whereby you will be charged margin for the larger portion of the hedge trade, and nothing for the smaller portion. 

For example, you are trading CFDs and have two open Wall Street positions, originally selling a quantity of 10 and then buying a quantity of 5. In this case, you would only be charged margin for the original, larger side of the trade, the Wall Street short 10 position. If the margin for selling 10 Wall Street is £1,691.45 and the margin for buying 5 Wall Street is £845.70, you would only need to provide enough margin to cover the original, larger sell position for both trades in this market. 

If you are fully hedged, your margin should be 0. If you are partially hedged, your margin should be the remaining part of the position. 

A margin close out is when we exit your positions on your behalf to stop excessive losses on your account. 

If your margin level falls to or below the margin close out (MCO) level, we may be required to close some or all of your open positions as quickly as possible. This is intended to help protect your account from incurring additional losses. We strongly recommend that you monitor your margin level carefully, as you should not expect to receive a warning before positions are closed. The Margin Level Indicator available on the  trading platform can help you monitor your margin level.

Your margin level is calculated by dividing the net equity in your account by your total margin requirement and multiplying the result by 100. To improve your margin level, you can do one or more of the following:

• Deposit additional funds
• Close or partially close positions
• Use risk-management tools, such as stop-loss orders

Please note that during periods of heightened market volatility, prices may gap, which could affect the level at which positions are automatically closed.

Learn more about margin risk in spread betting. 

If your margin drops below 100% of your total requirement, then your positions are at risk of being closed. We’ll usually start automatically closing trades when it hits 50% of your total requirement. The calculation for the margin level indicator is determined by the net equity in your account divided by your total margin requirement, multiplied by 100. 

For weekend trading on Crypto CFD or spread bet markets (Pro clients only), the normal close out process would apply. In the event your account margin level drops to 50% or below, any Crypto positions in markets which were open would be closed out. Any remaining open positions on non-Crypto markets would then be closed upon the respective market opening on Sunday evening. 

Please be aware that during times of high volatility market prices can gap and this may affect the prices at which your positions are closed out. 

Find out more about risk management with CFDs.