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Library / Forex trading at Exness / Change in the margin requirements on weekends and holidays

Change in the margin requirements on weekends and holidays

In this article, we will use simple examples to demonstrate how the margin is calculated on trading orders under changed margin requirements on weekends and holidays in accordance with the rules of Exness Group.

It is important to note that for orders opened before 19:00 GMT+0 on Friday, the margin is not changed. The margin increased for orders opened during the period from 19:00 GMT+0 on Friday through 23:00 GMT+0 on Sunday, and in some instances when transactions are closed during this period.

It is convenient to use the Trader's Calculator to calculate the margin.  

Example 1. Opening and closing transactions during the period of increased margin requirements

Suppose that you are using leverage of 1:2000 and that your account is a USD account. 

Time Action Total margin on the account
Thursday, 22:00 GMT+0 Open the first order
sell 1 lot USDCHF
50 USD
Friday, 20:00 GMT+0 Open the second order
sell 1 lot USDCAD
550 USD
Sunday, 22:00 GMT+0 Close the second order
sell 1 lot USDCAD
50 USD

After the first order is opened, the margin on the account is 50 USD. An hour before the second order is opened, the increased margin requirements take effect. Accordingly, the margin on the transaction will be calculated based on leverage of 1:200 and will be equal to 500 USD. The total margin on the account is 550 USD.

The second order, for which margin amounting to 500 USD is imposed, will be closed. Accordingly, the total margin is reduced to 50 USD.

Example 2. Opening a hedging position during the period of increased margin requirements

Suppose that you are using leverage of 1:2000 and that your account is a USD account.

Time Action Total margin on the account
Thursday, 22:00 GMT+0 Open the first order
sell 1 lot USDCHF
50 USD
Friday, 20:00 GMT+0 Open the second order
buy 1 lot USDCHF
0

After the first order is opened, the margin on the account is 50 USD. An hour before the second order is opened, the increased margin requirements take effect, but due to the fact that the second order hedges the first order and the margin on hedged positions is zero, the total margin on the trading account will also be zero.

The margin on hedged positions is equal to zero for all account types at Exness Group, except ECN accounts, for which margin requirements do not change on weekends and holidays.

Example 3. Partial hedging during the period of increased margin requirements

Suppose that you are using leverage of 1:2000 and that your account is a USD account.

Time Action Total margin on the account
Thursday, 22:00 GMT+0 Open the first order
sell 2 lot USDCHF
100 USD
Friday, 15:00 GMT+0 Open the second order
sell 3 lot USDCHF
250 USD
Friday, 20:00 GMT+0 Open the third order
buy 4 lot USDCHF
50 USD

After the first order is opened, the margin on the account is 100 USD. The margin on the second order is 150 USD, and after it is opened the total margin on the account will be 250 USD.

The third order is opened after the margin requirements are increased, but it hedges the second order fully and one lot of the first order.

It is important to note that hedging begins with the most recently opened offsetting positions.

In the end, only one lot from the first order remains unhedged and thus the margin on the account will be 50 USD.

Example 4. Closing a hedged position during the increased margin requirements

Suppose that you are using leverage of 1:2000 and that your account is a USD account.

Time Action Total margin on the account
Thursday, 22:00 GMT+0 Open the first order
sell 2 lot USDCHF
100 USD
Friday, 15:00 GMT+0 Open the second order
sell 3 lot USDCHF
250 USD
Friday, 16:00 GMT+0 Open the third order
buy 4 lot USDCHF
50 USD
Sunday, 22:00 GMT+0 Close the third order
buy 4 lot USDCHF
2050 USD

After the first order is opened, the margin on the account is 100 USD. After the second order is opened, it will be 250 USD. And after the third order, which creates a partial hedge, is opened, the margin is reduced to 50 USD.

Then suppose that before the period of increased margin requirements ends you decide to close the order that is partially hedging the positions in your trading account. According to Exness' rules, in terms of calculating the margin, closing this type of order is the same as opening a new transaction under the increased margin requirements.

Thus, closing the hedging order "buy 4 lot USDCHF" during the period of increased margin requirements is the same as opening a new position with respect to calculating the margin. The margin for 4 lots of USDCHF with leverage of 1:200 is 2000 USD. The existing margin on the account (50 USD) is added to this amount. Thus, the total margin on the trading account is 2050 USD.

Moreover, this margin will be distributed across the open orders in proportion to their volumes. In this case, "2 shares" are assigned to the first order and "3 shares" are assigned to the second order. The margin on these orders is 820 USD and 1230 USD respectively, which is taken into consideration when closing one of the positions on the account.

If you have additional questions about calculating margin, Exness client support is ready to answer them round-the-clock.

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