Leverage & Margin

Leverage is a powerful tool in the forex market because it allows traders to open positions much larger then their account limits, thereby increasing their buying power and potential profit/loss.

ACM USA Margin Basics

With leverage, comes the term margin. ACM USA requires clients to maintain 1% margin, based on 100:1 leverage on standard accounts and institutional accounts. For mini accounts, 100:1 leverage is offered with a minimum margin requirement of 1%. This allows clients to efficiently control positions that are worth 100 times their deposited capital.

That said, it is important to remember that without the appropriate risk management, a high degree of leverage can lead to significant losses or gains (double-edged sword). Thus, ACM USA built innovative margin monitoring tools into its trading platform. Should your capital fall below the prescribed margin level, your positions will be automatically closed to reduce further loss. This ensures that your account will never be overdrawn even in the most volatile markets. Unlike futures, you will never owe ACM USA nor the market money based on a poor trade.

Calculating Margin

The simple calculation for margin is:

i.e. A client with a standard account of 10,000 USD goes Long 4 USDCHF Standard lots. An hour later, the client has an open loss of 200 USD.

The Margin calculation would be as follows: