1.What is Margin?
In the futures market, traders can participate in buying and selling contracts by depositing only a small portion of the contract’s total value as collateral. This deposit serves as a financial guarantee to fulfill the contract’s obligations and is known as margin.
2.How is Margin Calculated?
Cross Margin Mode: In cross margin, all available funds in the account are treated as shared margin.
Formula:
Position Margin = Opening Margin - Opening Fee
Isolated Margin Mode: In isolated margin, each position’s margin is calculated independently, and profits or losses from one position do not affect others.
Formula:
Position Margin = Opening Margin - Opening Fee + Funding Fee + (Added Margin/Reduced Margin)
1.What is Margin?
In the futures market, traders can participate in buying and selling contracts by depositing only a small portion of the contract’s total value as collateral. This deposit serves as a financial guarantee to fulfill the contract’s obligations and is known as margin.
2.How is Margin Calculated?
Cross Margin Mode: In cross margin, all available funds in the account are treated as shared margin.
Formula:
Position Margin = Opening Margin - Opening Fee
Isolated Margin Mode: In isolated margin, each position’s margin is calculated independently, and profits or losses from one position do not affect others.
Formula:
Position Margin = Opening Margin - Opening Fee + Funding Fee + (Added Margin/Reduced Margin)