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amount of funds needed


umathai

Question

Apologies for the basic question but I want to ensure I transfer enough funds for my first trade.

id be looking at a 1 point trade on bitcoin with the current approximate margin of £2500 (50% value) ...….. should I just transfer the margin or should I add £3500 instead to my account especially if im happy to ride a £1000 drop

Thanks for your help

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1 hour ago, umathai said:

Apologies for the basic question but I want to ensure I transfer enough funds for my first trade.

id be looking at a 1 point trade on bitcoin with the current approximate margin of £2500 (50% value) ...….. should I just transfer the margin or should I add £3500 instead to my account especially if im happy to ride a £1000 drop

Thanks for your help

the margin quoted is the opening margin but there is also an operating margin so if the trade starts to go negative you will automatically be asked to deposit more if you have no spare margin in the account so to have some extra as lee way is advisable.

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Well, i ask because i had a position on ftse, 1000 in my account, 3 a point, 300 guaranteed stop, said margin needed like 909, but had email alert saying to fund my account or position may be closed ? surely that aint right, i traded for years back in 2008/2009, surely guaranteed stops should mean that, so no extra margin needed, or has the rules changed ?

Edited by Daytraders
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14 minutes ago, Daytraders said:

Well, i ask because i had a position on ftse, 1000 in my account, 3 a point, 300 guaranteed stop, said margin needed like 909, but had email alert saying to fund my account or position may be closed ? surely that aint right, i traded for years back in 2008/2009, surely guaranteed stops should mean that, so no extra margin needed, or has the rules changed ?

yes the rules changed, the new esma regulations came in 2018 capping leverage to just 20:1 from the prior 200:1.

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11 minutes ago, Daytraders said:

I see, but my example above, would not need additional funds surely ? as i had a guaranteed stop in place.

as I understand it the margin requirements are rigid and set by the regulator (esma) not by the broker who must apply as per the EU directive regardless of any other factors. I may be wrong but have not heard of any escape clause that can be enacted by the broker other an registering as a professional client.

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