Forex Margin Calculator (US 50:1 and 20:1 Leverage)
Use this free forex margin calculator to see how much margin a position ties up under US leverage rules: 50:1 (2% deposit) on major currency pairs and 20:1 (5%) on all others. Add your balance to see free margin, effective leverage and the largest position you could open.
US retail forex dealers must collect at least 2% on major pairs (50:1) and 5% on others (20:1); brokers may ask for more. Gold is not a CFTC retail forex product. Educational tool only.
How Forex Margin Is Calculated
Margin required = Position value in USD ÷ Leverage
- The position value (notional) is the number of units times the price of the base currency in dollars. One standard lot is 100,000 units of the base currency.
- For EUR/USD at 1.1000, 0.5 lots is 50,000 euros worth $55,000. At 50:1 the margin is $55,000 ÷ 50 = $1,100.
- For USD/MXN, 0.5 lots is $50,000. Because the peso is not a major currency, US rules allow only 20:1, so the margin is $2,500.
- For a cross such as GBP/JPY, the base currency (pounds) is converted to dollars first. At 195.00 with yen at $0.0067, 0.5 lots is worth about $65,325, so the margin at 50:1 is about $1,306.50.
US Margin Rules
Under CFTC rules, retail forex dealers in the United States must collect a security deposit of at least 2% of the notional value on major currencies and 5% on all others. That is where the 50:1 and 20:1 leverage caps come from. Brokers can require more, especially around major news or weekends. See US forex trading rules for the full picture.
Margin Is Not Risk
Margin is the deposit the broker holds while a trade is open; it is not what you can lose. Your loss is set by your stop loss and position size. But margin limits how much you can open: if losses reduce your equity close to the margin in use, the broker can issue a margin call or close positions. Keep the margin of all open trades well below your balance, and size trades from risk with the position size calculator.
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Frequently Asked Questions
How much margin do I need for 1 lot of EUR/USD?
One standard lot at 1.1000 is worth $110,000, so at the US maximum of 50:1 the margin is $2,200. A mini lot needs $220 and a micro lot $22.
What is the maximum leverage for forex in the US?
50:1 on major currency pairs and 20:1 on other pairs for retail traders.
What is effective leverage?
The total value of your open positions divided by your account balance. A $55,000 position on a $5,000 account is 11:1 effective leverage, even though the broker allows up to 50:1.
Sources
- CFTC regulations, 17 CFR 5.9, security deposits for retail forex transactions (eCFR).
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