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How to Manage Margin in TradingView
Margin plays a critical role in trading, as it determines the capital required to open and maintain positions. Here are some strategies for managing margin on TradingView to avoid unexpected losses or margin calls.
Understand Your Margin Requirements: Each asset you trade has specific margin requirements that depend on the leverage you choose. TradingView automatically calculates these margins when you place an order. For example, with a leverage ratio of 1:100, a trade worth $1,000 might only require $10 in margin. Understanding these requirements is crucial to avoid overextending your account.
Monitor Your Margin Level: Keep an eye on your margin level in the Trading Panel, which is the percentage calculated as (Equity / Used Margin) x 100%. This figure indicates the health of your trading account. A margin level below a certain threshold (often 100%) could result in a margin call, meaning you may need to add funds or close positions to avoid liquidation.
Limit the Number of Open Positions: Each open position requires a portion of your margin, so maintaining multiple trades can quickly diminish your free margin. To ensure you’re not over-leveraging, consider limiting the number of simultaneous trades you hold.
Use Leverage Wisely: While higher leverage can lower your margin requirements, it also increases your risk. In TradingView, it’s important to choose a leverage level that aligns with your risk tolerance.