For Your Understanding:	Margin	Profit	Quotas
For Your Understanding:	Basic Technical Analysis	Fundamental Analysis	Basic Technical v.s. Fundamental

Understanding Margin

Trading currencies on margin lets you increase your buying power. Here's a simplified example: If you have $2,000 cash in a margin account that allows 400:1 leverage, you could purchase up to $800,000 worth of currency-because you only have to post 0.25% of the purchase price as collateral. Another way of saying this is that you have $800,000 in buying power.

Benefits of Margin

With more buying power, you can increase your total return on investment with less cash outlay. Trading on margin should be used wisely as it magnifies both your profits AND your losses.

Managing a Margin Account

Trading on margin can be a profitable investment strategy, but it's important that you take the time to understand the risks.

You should make sure you fully understand how your margin account works. Be sure to read the margin agreement between you and the clearing firm. Talk to your account representative if you have any questions.
The positions in your account could be partially or totally liquidated should the available margin in your account fall below a predetermined threshold.
You may not receive a margin call before your positions are liquidated.

You should monitor your margin balance on a regular basis and utilize stop-loss orders on every open position to limit downside risk. Always be aware that stop loss orders are not guaranteed and are subject to market conditions.

Margin

The maximum available margin is .25% (400:1 leverage), although some still only offer a maximum of 1% (100:1 leverage)*. Traders always have the option of employing a lower degree of leverage. Keep in mind that the lower the leverage used requires a larger amount of margin capital for the trade.
Margin = (Contract size / Leverage)

The minimum margin requirement is approximately $250 per lot in a mini $100,000 account. The requirements for leverage may vary with account size or market conditions, and may be changed from time to time at the sole discretion of the FCM. Margin requirements may vary from .25% to .5% during heavy trading hours of start of London session until the close of the New York session and range up to 2% during light trading hours or off-trading hours.

If maximum leverage is employed, traders must maintain the minimum margin requirement on their open positions at all times. It is the customer's responsibility to monitor his/her margin account balance. FXCM has the right to liquidate any or all open positions whenever a trader's minimum margin requirement is not maintained. This is an important risk management feature designed to strictly limit trading losses in your account.

Margin Example:
You have $5,000 in a mini account. To calculate the margin required to execute 4 standard lots of USD/JPY (400,000 USD) at 400 leverage, simply divide the deal size by the leverage amount e.g. (400,000 / 400 =1,000). You post $1,000 margin for this trade, leaving a $4,000 balance in your account.

The trading platform automatically calculates margin requirements and checks available funds before allowing you to successfully enter a new position. If you do not have adequate funds available to enter a new position, you will usually receive an "insufficient margin funds" message when attempting to deal.

If the unrealized P&L of your net total open position falls below your account balance, your account is under margined and all your open positions may be liquidated. To avoid liquidation of your positions, do not use your entire account balance as margin for open positions. Instead, leave enough funds in your account to withstand a market movement against your open positions.