What is the Difference Between Equity & Margin in Metals Trading?
Equity is the total amount of capital in a metals trader's account while margin is amount of money required by your metals broker so that to allow you to continue trading with the borrowed amount that you've borrowed after using metal trading leverage.
If there are no trades then the equity is equal to free margin - this free margin is the amount available for opening new metal trades and because there are no open metal trades then this free margin is equal to the equity in the trader's account.
When a trader opens new trade transactions using part of their equity then the margin used to open trades is known as used margin and the part of their equity that has not been used to open metal trades is known as free margin.
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Metals Leverage and Margin Course
