Margin Call calculation

[Guest Beringin]

Hi,

 

I am a beginner currency trader, focussing only on USDJPY.

I am trying to calculate total money I need (as potential useable margin and margin), to accommodate market swings.

 

For example,

Let's say I want to go long on USDJPY (entering at 113.00), with minimum size of 50K, with minimal margin required of 0.5%. That means, I need to put 50USD (For minimum position size of 50K, minimum margin required is 0.5%, that will be 1:1000, that will be 50USD.)

If the market swings against me by 50 pips or 100 pips, going to 112.50 or 112, and I want to hold my open long position, I would like to know the additional useable margin I will need so that I can keep my positions open.

 

Please let me know if my calculations are correct or if they are wrong, please let me know the right way of calculating the required additional margin, if market moves against me (and I want to open my position).

 

 

Scenario 1: 50 pips movements, how much USD is needed for potential margin?

1 pips = 0.01 JPYUSD - 1 JPY = 0.009 USD - 1 pips = 0.09/10 JPY = 0.009 JPY or 0.00008 USD, 

50 pips = 0.004 USD.
With leverage of 1:200, 50 pips = 0.8 USD.
Lot size = 0.05 x 100,000 = 50,000
0.8*50K = 4K
Margin required on 4K = 0.5% = 20USD. <Is this correct?

 

Scenario 1: 100 pips needs how many dollar of margin?
1 pip = 0.00008 USD
100 pips = 0.00008 USD x 100 = 0.008 USD
With leverage of 1:200, 100 pips = 0.008USD x 200 LEVERAGE = 0.8 USD.
With lot size of 0.05 x 1000,000 = 50,000,100 pips = 0.8USD x 50,000 units = 40K.
Using 0.5% margin, 40K requires, 200USD deposit. <Is this correct?