The collateral required by a broker to open a position. In forex with 1:100 leverage, a $100,000 position requires $1,000 margin. Prop firms handle margin internally — your concern is drawdown limits,
The collateral required by a broker to open a position. In forex with 1:100 leverage, a $100,000 position requires $1,000 margin. Prop firms handle margin internally — your concern is drawdown limits, not margin calls. However, if your open positions consume too much margin, you may be unable to open new trades. Always check your firm's margin requirements for each instrument, especially gold and indices which require significantly more margin than forex pairs.