Margin is the deposit a broker holds against a leveraged position, and for retail traders in the UK and EU it is governed by hard regulatory limits. This calculator applies the ESMA and FCA leverage caps to your position so you know exactly how much margin is required and where the automatic close-out sits.
How it works
Margin is the notional value scaled by the regulatory margin rate, which is the inverse of the leverage cap for the asset class:
margin rate = 100 / max leverage (e.g. 30:1 → 3.33%)
required margin = notional value × margin rate
stop-out equity = required margin × 50% (ESMA close-out rule)If you enter a broker leverage that is stricter than the cap, the tool uses it and raises the margin accordingly. If you enter one looser than the cap, it is rejected for retail accounts and the regulatory cap applies instead.
Example and notes
A 50,000 position in a major FX pair at the 30:1 cap requires about 1,667 in margin. The 50% close-out rule means that once your equity on the position falls to roughly 833, the broker must close it, so a loss of about 833 from your margin triggers the stop-out. These are educational figures, not trading advice: actual margin can vary with overnight financing, slippage, and the precise close-out mechanics of your broker, and crypto at 2:1 ties up far more capital per unit of exposure than major FX.
ESMA and FCA leverage limits at a glance
The regulatory caps differ by asset class because volatility and liquidity differ. More volatile assets require larger margin buffers:
| Asset class | Max leverage (retail) | Margin rate | Example: 10,000 position |
|---|---|---|---|
| Major FX pairs | 30:1 | 3.33% | ~333 margin |
| Non-major FX, gold, major indices | 20:1 | 5% | ~500 margin |
| Commodities (non-gold), minor indices | 10:1 | 10% | ~1,000 margin |
| Individual equities | 5:1 | 20% | ~2,000 margin |
| Cryptocurrency | 2:1 | 50% | ~5,000 margin |
Why the 50% close-out rule exists
Before ESMA intervened in 2018, some brokers operated close-out policies as low as 10–20% of initial margin, meaning traders could lose far more than their deposit before positions were automatically closed. The 50% floor protects retail clients from a cascading loss that wipes the account and produces a negative balance. Combined with the mandatory negative balance protection that accompanies ESMA rules, a retail trader cannot lose more than the funds held in their CFD account.
Understanding margin call versus stop-out
Margin call is a notification your broker sends when equity falls to a threshold (often 80–100% of initial margin, varying by broker) warning you to deposit more or reduce positions. It is advisory.
Stop-out is compulsory. At 50% of initial margin, the broker must close positions — typically the largest losing position first — until the account returns above the threshold. No negotiation is possible. Knowing the exact stop-out level for your position size before you open a trade is critical risk management, and that is exactly what this calculator provides.
A note on professional client status
If you qualify and opt in as a professional client under MiFID II, you lose mandatory ESMA retail protections including the leverage caps, negative balance protection, and the 50% close-out rule. Higher leverage is available but the floor on losses is removed. Consider this carefully before opting up.