What Does 20% Gold Margin Requirement Mean?
Margin requirement is the percentage of the trade transaction value that a trader must maintain so as to continue holding the open trades that have been opened using xauusd trading leverage.
Example of How Does 20% XAUUSD Margin Requirement Work?
Now if Your Gold Trading Leverage is 100:1
When trading if you have $1,000 & use option 100:1 & buy 1 standard lot for $100,000 your gold trading margin on this trade is the $1000 dollars in your xauusd trading account, this is the money that you will lose if your open trade goes against you the other $99,000 that is borrowed from the broker, the broker will close the open gold trades automatically once your $1,000 has been taken by the xauusd market.
But this is if your gold broker has set 0% Gold Margin Requirement before closing your xauusd trades automatically.
For 20% Gold Margin Requirement before closing your xauusd trades automatically, then your trades will be closed once your trading account balance gets to $200
Gold brokers will place this level for a gold trader's account, choose those gold brokers that set 20% margin requirements, in fact, those gold brokers that set at 20% margin requirement are the best because the likely hood they closeout your gold trade is reduced as displayed in the example above.
Some gold brokers will set these zones at for 50% Gold Margin Requirement before closing your xauusd trades automatically, meaning that your transactions will be closed once your balance gets to $500.
To Know More about Gold Leverage & Margin - Read the Topics Below:
Gold Leverage & Margin Lesson
