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Margin

Margin refers to the amount of money required to open and maintain a leveraged trading position. In forex trading, traders need to put up a small amount of capital to open a new position, which is known as the initial margin.


This amount is the difference between the full value of the position and the funds being lent by the broker. There is also a maintenance margin that's required to keep the position open.


If the trade starts to incur losses and the deposit margin is no longer sufficient, the broker may issue a margin call, requiring the trader to deposit more cash into their account as maintenance margin.


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