What margin actually is
Every forex calculator you have used treats margin as a consequence of leverage. You pick 1:100, and margin becomes position size divided by 100. Futures does not work that way. There is no leverage ratio. The exchange publishes, per contract, a cash figure that must sit in the account for you to hold the position — and it publishes a different figure for every product, revised whenever it judges the market has become more or less risky.
That single difference is why a forex calculator cannot price a futures position, and why this page asks for margin per contract as an explicit input instead of a leverage selector.
Initial margin = Margin per contract × Contracts
Margin utilisation = Initial margin ÷ Account equity
Margin is collateral, not risk
The most expensive mistake in futures sizing is treating the margin figure as a measure of how much is at stake. It is not. Margin is what you must post; risk is what you can lose. Consider two positions on the same contract:
- A 10-contract position with a stop 5 ticks away. Margin may be substantial, risk is small.
- A 1-contract position with a stop 200 ticks away. Margin may be small, risk is substantial.
The second position will not trigger a margin call until price has moved a long way, which feels safe. It is not. By the time the call arrives you have already lost many times the collateral on deposit. Conversely the first position looks dangerous on a margin screen and is not.
Read the two numbers together. Margin utilisation tells you whether you can survive a funding shock. Cash at risk tells you whether you can survive being wrong.
Why exchanges raise margin
Exchanges exist to guarantee that counterparties do not default. When a market's realised volatility rises — a limit move, a supply shock, a policy surprise — the probability of a trader's loss exceeding their collateral rises with it, so the exchange raises the margin requirement for that product. In practice this means the requirement is highest exactly when you are most likely to be holding a losing position.
This is the mechanism behind the most common blow-up shape in futures: a trader sizes to 60–80 percent margin utilisation, volatility spikes, the exchange raises margin by 50 percent, and the account is now over-leveraged at precisely the wrong moment. The position is liquidated into the move. Keeping utilisation low is not conservatism for its own sake; it is reserving capacity for the one time the requirement jumps.
Initial versus maintenance margin
Two levels matter. Initial margin is what you must have to open and continue holding. Maintenance margin is a lower threshold — commonly 60 to 80 percent of initial but set per product — at which the broker issues a call and requires you to bring the account back to the initial level.
The gap between them determines how much adverse movement you can absorb before anyone telephones you. The calculator takes maintenance as a percentage of initial and converts the gap into two numbers that are far easier to act on: the points the market can move against you, and the actual price at which you would be called.
That second figure is worth writing down before you enter. If the call price is inside the noise of a normal session, the position is sized too large regardless of what your stop says.
Notional exposure per dollar of margin
Dividing notional value by the margin posted gives the true gearing of the position, and for futures it is often startling: a product with a 5 percent margin requirement is geared 20 to 1. This is the figure that matters when comparing margin efficiency across products, and it is the reason a small futures account can carry exposure that would require a six-figure forex account.
Working rules
- Keep single-position utilisation under about 30 percent. That reserves room for a routine margin revision.
- Check the call price, not just the stop price. If the call price is comfortably beyond your stop, your stop is the binding constraint and the trade is governed by your risk rule. If it is not, margin is the binding constraint and your risk rule is decorative.
- Re-check margin before adding to a position. The exchange publishes revisions on its own schedule, not yours.
- Do not size to intraday margin. Intraday reductions can vanish same-session.