CFD trading using margin allows you to open a position by only depositing a percentage of the full value of the position. Margin is used to cover any credit risks that arise during your trading.

Please remember that profits and losses are relative to the full value of your position. This means that you could lose more than what you deposit for margin.

Margin Requirements (and the associated Margin Percentage) vary with each Product within the leverage restrictions imposed under the Product Intervention Instrument, and a list of the requirements is set out on the Trading Platform. These may change regularly.

At GLOBEX , the margin requirement (per lot) is either represented as a ratio or percentage.

For example, you decide to buy €100,000 because you think the price of EUR/USD will go up. EUR/USD has a margin rate of 3.0:1, which means you have to deposit 3.33% of the total position value as initial margin. Therefore, in this example your initial margin will be $3,946.32 (3.33% × [€100,000 × 1.18508]). The platform will automatically convert the initial margin amount into your account currency at the prevailing GLOBEX conversion rate.

In this Share CFD example, AAPL is trading at a sell/buy price of 122.52/122.67. Assume you want to buy 100 Shares (1 CFD = 100 shares) because you think the price will go up. AAPL has a margin rate of 5:1, which means that you have to deposit 20% of the position’s value as initial margin. The platform will automatically convert the initial margin amount into your account currency at the prevailing GLOBEX conversion rate.

Leverage is another expression of margin percentage.

Leverage = 1 / Margin Percentage

For example, the margin requirement for #AAPL is 20%. It means that Leverage for #AAPL is 5:1.

At GLOBEX , clients can trade with the following leverage:

• 30:1 for CFDs referencing an exchange rate for a major currency pair
• 20:1 for CFDs referencing an exchange rate for a minor currency pair, gold or a major stock market index
• 10:1 for CFDs referencing a commodity (other than gold) or a minor stock market index
• 5:1 for CFDs referencing shares or other assets

Hedging is taking on both Long and Short positions of the same size in the same product simultaneously in order to reduce the risk in an adverse market. This involves opening a position in the opposite direction of the same size as the initial opened position. The margin requirement for holding hedged positions is 0.

The trading platform will automatically begin to liquidate open orders when the client’s Total Equity balance falls below 50% of the Initial Margin Requirement. The trading platform will liquidate individual positions until the remaining Client Total Equity is sufficient to support existing open position(s). In deciding what positions will be individually liquidated the largest losing position will be closed first during liquidation.

Similarly, the margin in your trading account needs to be more than 50% for open positions in order to be able to open new trades, unless the new trades will result in current positions being partially or fully hedged.

GLOBEX provides different margin and leverage for different instruments. To view GLOBEX Margin Requirement, click on the Instruments below.
It is strongly advised that clients always maintain the appropriate amount of margin in their accounts.