When trading CFDs on PrimeXBT, the leverage you select reflects the amount of margin - personal funds, you need to open a position.
You're able to easily calculate the required margin using the following formula:
Required margin = Value of the trade / Leverage
Calculating required margin
For example: Let's assume that BTC is worth $67,000, and you'd like to open a position worth 1 BTC with 200:1 leverage. The required margin for this trade will be:
$67,000/200 = $335 (0,005 BTC)
Alternatively, you can overview the 'Margin impact' field to automatically calculate the amount of margin you need to open a new position.
Why do I have to maintain minimum required margin?
When trading with margin, it's important to always keep a sufficient amount of funds in your trading account, and never use 100% of your Available margin. This helps secure your positions from Liquidation if the market moves against your trade.
What is a Margin Call?
A Margin Call is a platform notification/email reminder that warns you when your Available margin is low. It also informs you that Liquidation may occur if your positions continue incurring loss.
We highly recommend that you control your positions and keep a sufficient amount of funds in your trading account at all times, even if you're convinced that the trade will be profitable.
We can't guarantee that a Margin Call will be delivered shortly after your margin drops below the required minimum, or prior to Liquidation.
How does Liquidation work?
Liquidation of a position(s) takes place when your trading account balance - Available margin drops to 0%. In this event, all of your open positions are closed as Market orders to settle the P/L.
Once Liquidation has been completed, the margin you used to leverage these trades will be unlocked and available again to open new trades, or withdraw.
To prevent Liquidation and manage the risks, we highly recommend using Stop Loss and Take Profit protection orders.