What is Equity, Margin, and Free Margin?


Equity refers to the amount of money a trader has in their trading account (i.e. their Balance) plus or minus the bonus and any profit or loss from open positions. If, however, the trader doesn’t have any open positions, his or her equity is equal to his or her balance.


Margin is the amount of money that a trader needs to put forward in order to open a trade. When trading forex on margin, you only need to pay a percentage of the full value of the position to open a trade.

Free Margin

Free Margin is the amount available on your account to open new positions.

 Free Margin = Equity – Used Margin

  — Equity = Balance + Profit & Loss