Important: To simplify the calculation of reserve funds requirements we recommend using the trader’s calculator.
The formula for calculating reserve funds in the base currency:
Reserve Funds = Contract size / Level
The base currency is a currency, standing first in the quote, for example:
The size of a contract is the amount of a contract in the base currency. The value of 1 lot is always 100,000 units of base currency. Accordingly, the value of 0.1 lot = 100,000 * 0.1 = 10,000 units of base currency, the value of 0.01 lots = 100,000 * 0.01 = 1,000 units of base currency;
Level is a ratio between the trader’s own funds and borrowed funds, for example:
After calculating the reserve funds in the base currency, convert it into the deposit currency (according to the exchange rate at the time of opening positions) -- US dollar, Euros, etc.
Consider this example:
A trader uses 1:500 level to open a position BUY 1 lot EURUSD 1.2457. The reserve for this position is calculated as follows: