Forex glossary
Free margin (available margin)
Documentation context: MT5 states that inclusion of floating P/L in available-funds calculations can depend on the account provider.
Free margin is equity minus required margin under the account's rules. It indicates unused collateral capacity, not automatically withdrawable cash. With positive used margin, zero free margin means 100% margin level, not a universal stop-out trigger.
Illustrative example
How does it work in practice?
On a hypothetical account, equity and margin are both 1,000 USD. Free margin is zero and margin level is 100%; an assumed close-out rule below 50% has not yet been triggered.
One account, four different figures
Balance, equity and available collateral
Model with no credit, fees or blocked amounts: balance 10,000 USD, open P/L −800 USD and used margin 2,000 USD.
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| Term | What it describes | Shared example |
|---|---|---|
| Balance | Booked funds; open P/L does not change balance in this model. | Balance remains 10,000 USD. |
| Equity | Current account value; margin is not deducted from it. | 10,000 − 800 = 9,200 USD. |
| Margin (deposit margin) | Required collateral, rather than a fee already paid. | The positions require 2,000 USD of collateral. |
| Free margin (available margin) | Equity minus margin; not the same as withdrawable cash. | 9,200 − 2,000 = 7,200 USD. |
| Margin Level | Equity relative to margin, expressed as a percentage. | 9,200 / 2,000 × 100% = 460%. |
Takeaway: Identify whether a figure is a booked amount, account valuation, collateral requirement or ratio. Do not deduct margin from equity.
Change an assumption, see the result
What changes if…?
Bring equity towards used margin. Observe when free margin reaches zero, then compare that with a separately selected model stop-out threshold.
Model: equity = balance + open P/L; free margin = equity − margin. No credit, fees or other blocks. The stop-out threshold is hypothetical; the actual formula and action depend on the provider’s terms.
Check your understanding
Distinguish zero free margin from a forced-close threshold.
Show the answer and explanation
Free margin is 0 USD and margin level is 100%; the stop-out condition is unmet.
1,000 − 1,000 = 0 USD; 1,000 / 1,000 × 100% = 100%. This differs from the assumed 50% threshold.
Read the account and its margin thresholds
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Related terms
Sources and documentation
- MetaTrader 5: executing trades
Execution modes, requotes, position handling and local trailing on this platform.
Document read: - MQL5 Reference: Account Properties
Account properties distinguish equity and margin values and separate margin-call and stop-out thresholds expressed in percentages or deposit currency.
Document read:
The example illustrates the mechanism. Check current account conditions and instrument specifications with the provider.