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Not enough money and margin calls

Hi there, I am just starting here.
I have an inquiry, I am currently trading, and my positions have a margin call around 50% of my bankroll, sometimes a bit more, therefore when I want to open a second position It doesn´t let me because " I have not enough money" to cover the margin call.

I guess that is because the leverage is not too much, am I right?
How can I make to be able to open more positions without putting more money???

Any help is higly appreciated!

Nacho B

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@NACHOB87 I’m going to answer your questions, but I strongly recommend to cover the basis before opening any trade or investment, otherwise you can make a huge mess and lose money without even knowing why.

It is a margin problem, so you need to understand how margin works.

On your MetaTrader 4, you have Balance, Equity, Margin and Free Margin.

Balance shows how much money you have in your account. Results of current trades are not included.
Equity shows how much money you have in your account + results of current trades.

Let’s have a break and have a small practical example.
You have $1,000 and a current position on EUR/USD that is losing $30. You will have:

Balance: $1,000
Equity: $970

Margin is the amount of money that you have to guarantee to your broker in order to open your positions. For the sake of simplicity, let’s say that your account is in USD.
You want to open a trade on EUR/USD with 0.01 volume.
0.01 volume means that you are opening an investment with a value of $1,000, so you have to guarantee to your broker $1,000. Your margin will be $1,000. If your margin is bigger than your equity, you can’t open the trade because, to use your words, “you don’t have enough money”.
Here comes the leverage. Darwinex offers a leverage of 30:1, this reduces the margin you have to guarantee by 30. In the example above, you had a margin of $1,000. With a leverage of 30:1, your margin becomes $33.33.
If you have $1,000 in your account and you open such a trade, you will have:

Balance: $1,000
Equity: $1,000
Margin: $33.33
Free Margin: $966.67

You can still use $966.67 to open other trades.

What if you wanted to open the same position with a broker that offers a leverage of 1000:1?
I give you the task to calculate everything, I share the results:

Balance: $1,000
Equity: $1,000
Margin: $1
Free Margin: $999

You can understand that the higher the leverage, the lower the margin you have to guarantee to your broker, the more positions you can open.
Of course, you also have to take into account that if your trades are going bad, having losses, your equity will drop and so your free margin, exposing you to the risk of having a margin call.

Most European Brokers have to adhere to ESMA rules, so you won’t find any leverage higher than 30:1.
American brokers can offer 50:1. Offshore brokers can go much higher than that, but usually they offer less guarantees for your money.

Good luck :slight_smile:

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Thank you very much for the answer.
I understand what u say, then Darwinex offers 1:30 Leverage, I guess that was the correct question :joy:.

I conclude the problem is that I trade always with stop loss of 1,5% of my bankroll , that means that if the stop loss is little in pips, say 4 pips In some sniper entries, then I have to buy Big lot size to make my SL equal 1.5% of my bankroll.
Therefore probably won’t happen when I use bigger SL in pips.

Thank you for your help!
Cheers

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You find the different margin rates in % here


You can calculate the different leverages from that data sheet.

In special situations margin rates will raise for a while or an asset can be suspended from trading.
Usually you receive an email before.

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