Used Margin

When you open an account with the company trading allows a margin deposit of the advance will
continue to be a fixed amount that amount without prejudice to decide to buy a car, or to decide to enter into a deal, then your account will be divided into two parts:

Margin user used margin: a deposit which will be deducted in advance, a refundable deposit will be returned to your account after the sale of the car, whether it was sold at a profit or a loss.

Margin available usable margin: which is the amount left in your account after deducting the user margin, this amount is the maximum amount that allows you to defeat in the transaction.

How to calculate the user's margin?

We do not want to pay much attention to how the user in a margin account yourself often will not need so you will determine where the company beforehand the amount that will be deducted from your account as a token for every unit of the commodity. In the previous example car agency will tell you that it will be deducted the amount of $ 1,000 from your account in margin user for every car purchased. If I bought two cars will be deducted from your $ 2,000 margin the user will remain in your account $ 1,000 margin available.

Although the company, which will deal with Stagnate about the need to calculate the margin used by yourself, but it would be very useful to know how to do so yourself.

Can the user who his opponent will be a token provider for any commodity margin account with any company the following equation:

User margin = value of the item purchased full / percentage multiplier

In the previous example: the full value of the car = $ 10,000 and doubling the percentage allowed by the company is 10 times, which means that the company has doubled the capital you 10 times, so the margin by which St_chasm Agency:

Used Margin = Item full value / percentage multiplier = 10,000 / 10 = $ 1,000

Had I thought of buying two cars instead of the car will be used margin, which will be deducted from your account:

User = 20.000 / margin 10 = $ 2,000

In global markets are dealing brokerage firms that allow margin trading of various types of goods each company a certain quality of goods, the sale of each type on the basis of a fixed unit called the contract size which is less units are traded in the commodity.

In the previous example about cars = size of the contract is one car valued at $ 10,000, that is, you can not trade for less than a car valued at $ 10,000 and can be traded in multiples of this number was traded two cars or three etc ..

Of course it is not allowed to trade a car and a half !!

And be used margin calculation method:

Used Margin = number of contracts * contract / double volume ratio

The contract, which will learn to deal with the company and the proportion of pre-multiplexed before dealing with the volume, one of the things that may vary from one company to another.

In our previous example:

We know that the size of the contract = one car worth $ 10,000 and that the percentage multiplier = 10

So we know that if we are trading a car, the amount you St_chasm agency cars from our account is:

Used Margin = number of contracts * contract / percentage multiplier = 1 * 10.000 / 10 size = $ 1,000

But if we wanted to buy two cars will be:

Used Margin = number of contracts * contract / percentage multiplier = 2 * 10.000 / 10 size = $ 2,000

Thus you can be calculated for any number of user-margin cars if we assume that you wanted to buy three cars at once will be deducted the amount of $ 3,000 margin user.

If we assume that you have dealt with the agency cars have the same car value but it will give you double the ratio is equal to 20 times it means that this agency will allow you to trade Barabbas worth 20 times the amount paid a token you can calculate how much is the margin that will be deducted if you want to trade in one car:

Used Margin = number of contracts * contract / percentage multiplier = 1 * 10.000 / 20 size = $ 500

This means that this agency will be deducted from your account the amount of $ 500 for every car traded by. How to calculate the margin available?

Calculated by the following simple equation:

= Available margin balance - used margin

Only the previous example:

You deposit $ 3,000 in advance in your account that you opened the car agency Freehand have = $ 3,000

When I decided to buy a car, the company deduct the $ 1,000 margin the user, it will be the margin you have available now:

= Available margin balance - used margin = 3000 - 1000 = $ 2000

The maximum amount you can lose in the deal.

If we assume that you decided to buy two cars, it will be deducted $ 2,000 in margin and the user will be the margin you have available now:

= Available margin balance - used margin = 3000 - 2000 = $ 1000

The maximum amount you can lose in the deal.

Until now it has become learn the following:

That margin trading system is a system that gives you the possibility to trade goods worth over times your capital.

This type of trading is dealing with private companies are doubling your capital several times as it allows you to trade a commodity as compared to deduct a small percentage of its value as a token of the user.

These companies do not share your profit or loss where not only prompts the entire value of the goods sold and pay after the implementation of the exclusive purpose of buying and selling, which you specify a price that you choose commands.

If the item ordered it to sell at a higher price than the purchase price will be implemented and it will be deducted the full value of the item and would you Barbour plus full profit and like you own the item actually. Item though ordered it to sell at a price lower than the purchase price will be implemented and it will be deducted from your account has completed the full value of the item.

The introduction of margin

So that you can easily understand the working system of the margin mechanism we explained by significant example Serenade all the time.

Suppose you want to trade cars, so that you are buying a car and then sell them in the market to a buyer at a higher price, and how can you do this?

It will go to one of the agencies and big cars and choose a car that you imagine you will find the application on the market to assume that the price of the car with the car agency is $ 10,000.

All you had to do is provide this amount and pay agency cars and thus the owner of a car worth $ 10,000 .. Since the purpose of buying the car is traded, you go to the market and offers car hoping to sell at a price higher than the price you bought it.

Now suppose that when you went to the market and found that the demand for high quality car and there are a lot of people would like to buy ..and-ha will display your car at a price of $ 12,000, for example ..

If I sold this price is net profit from trading this vehicle $ 2,000, but what if I went to the market and found that the demand for the quality of your car is weak and he does not have a purchase it wants at a price of $ 10,000 and the maximum price one can buy your car is $ 8,000?

What does this mean?

Simply means that if you have sold at this price, the bris in trading this vehicle would be $ 2,000. It's clear the process is much work a day ..oamkink to do so you too.

But hey .. !!

To play the previous operation it is you need to be Mmtlka for the amount of $ 10,000 from the start to be able to buy a car purchase reject .. it is your capital in trading.

If you were not have this amount will not be able to buy a car and therefore would not be able to sell them in the market .. This means that in order to be able to trade in cars must be Mmtlka for the entire value of the car first ..

Is there a way because you are in this process without that you have $ 10,000?

Yes there is a way .. It is the modus operandi Margin Trading in margin basis

How so?

Why is the said to you his car agency: "If you wish to buy a car for trading with no need to pay me $ entire 10,000 worth all that is required of you is to pay me a deposit worth $ 1,000 only and I'm going to book the car in your name in order to give you the opportunity to sell in the market and then return to me the rest of the value. " It's a great opportunity and no doubt ..

Note that we said here, "booking" the car in your name .. any agency that cars will not actually give you the car, but will be booked in your name and make them at your disposal for the purpose of trading them so that you can sell at the price you want and if you actually possess.

But why Atatini car?

Because you did not pay only ten worth only ..van gave you the car has been taken and Ataud .. !!

So they are Atattiyk car even detain them in your name but the remainder of their ..

So how do I trade it?

Well ..andma know that you have a car in your name reserved for trading and that you can sell at the price you want it you can now go to the market and the search for a buyer at a higher price than the purchase price of the car.

Say you've found a buyer in the market for a car priced at $ 12,000 and then order an agency that sells auto car buyer reserved in your name at a price of $ 12,000.

Buyer will pay $ 12,000 and receive a car ..

Agency will deduct the value of the car motor which is $ 10,000 and you would respond Arbounk you paid a $ 1,000 profit, plus a full $ 2,000. Since you already no intention of trading only drive it will not differentiate you get a car or actually remain with the agency cars.

It is important that you had the opportunity to trade a commodity worth ten times the amount you paid and got the full profit like you actually have the item.

In this way the car agency to ensure access to the entire value of the car and you also get the full profit.

And this everyone will be happy .. !!

In the previous example, once the payment for the amount of $ 1,000 managed to get a profit of $ 2,000 no 200% of your capital paid just because you found a company that allows you to pay a fraction of the value of the item you would like to be traded.

It's a great chance right? But how did this happen?

That happened because the owner of the car agency allowed you the opportunity to double leverage your capital, which paid $ 1,000 to ten fold to $ 10,000 thus allowing you the opportunity to trade a commodity because the actual value of the largest ten times the value of your capital paid.

This is called double capital or leverage Leverage.

When you get the possibility of doubling your capital ten-fold meaning that you return for your payment - your investment - the amount of what it's given you the opportunity to trade a commodity worth more than ten times the value of your capital.

And when you get the possibility of doubling your capital to one hundred times it means that you exchange for payment of the amount of what it is you will have the opportunity to trade a commodity worth more than one hundred times the value of your capital.

And you'll get the full profit and if you have the item effectively.

Ie if we apply it to the previous example, it is against the payment of the amount of $ 10,000 you will have the opportunity to trade cars valued at $ 100,000 no ten cars once one .. If I gained on each car the amount of $ 2,000 means that your profit on the whole deal (2000 * 10 = $ 20,000 ) you'll get them all in the entire profit return on investment for the amount of $ 10,000 as a deposit refundable will return to you in the end .. !!

really ?

Yes reasonable .. which is what happens hundreds of millions per day in the financial markets and margin trading system.

Did you know now how to make millions?!

To go back to our example of the former:

In the beginning we mentioned how regular trading and has the following form:

You make a purchase through the payment of the full value of the car.

Go to the market and offer an Item up for sale.

You sell.

If your car is sold at a higher price than the purchase price to be a winner, but I sold it at a price lower than the purchase price to be a loser.

But when you have a way to trade the margin, this is what happened:

You buy from the agency cars are doubling your capital ten times so that you pay the amount of $ 1,000 as a deposit refundable and you do a temporary owner of the car until it is sold and re-valued.

When you pay the $ 1,000 allowed you car agency the possibility of trading away that worth $ 10,000, which she Mkntek to trade ten times your capital. I went to the market and offered an Item owned temporarily for sale. I sell so that the agency ordered a car to sell a car that temporarily owned - and they already have Basmk- the buyer who found him in the market at a price that you specify.

The car agency implementing it and sold the car to the buyer, then deducted original value - which Batk by car - no $ 10,000 and the rest as profit net Slmtk you and you returned the deposit paid at the beginning.

Note here ..

That when the car agency to double your capital tenfold, they did so to allow you the opportunity to trade the value of the car (items) worth more than 10 times the value of what you paid on that you pay the rest of the value of the car after you sell, or when you are paid the amount of $ 1000 and became owner temporarily for the car you become indebted to the Agency amounting to $ 10,000 cars until it pays the full value of the car, where the amount of $ 1,000, which is paid only a deposit refundable upon payment.

If you order the agency that sells auto car priced at $ 12,000, it will be implemented and it will deduct the $ 10,000 value of the car and you will re-deposit you paid plus the first $ 2,000 is profit in trading.

But what if the car is sold at a price lower than the purchase price?

What if I sold the amount of $ 8,000, for example? Then you will be required to complete the value of the car of your own pocket, or will be required to pay the amount of $ 2,000 until the complete value of the car and then recover Arbounk you paid in advance.

Just as the agency cars do not share your profit They also do not share your loss.

Whether you win or lose, it does not prompt you only pay the full value of the car after the sale, if ordered it to sell the car at a higher price than the purchase price will be implemented and it will be deducted the value of the car and then you are given a full Arbounk plus profit.

If ordered it to sell the car for less than the purchase price, which also will implement You'll need to pay from your own pocket it completes a full value of the car, and this amount is your loss in this transaction.

In the previous example, when the car is sold in the amount of $ 8,000 you need to add it to your pocket amount of $ 2,000 to become the amount of $ 10,000 and paid off the car and told you have to bear the loss and not a car agency, and in all cases recovered Arbounk prepaid.

But why not fool agency cars?!

Well: When we started our dealings with the agency vehicles that allow us to double the capital tenfold everything that we have paid is the amount of $ 1,000, and when ordered car agency to sell the car at a price of $ 12,000 - after he found her on the buyer at this price - the Agency to sell the car at a price that we set and she returned us the down payment plus the full profit.

If: If you ordered the agency to sell the car at a price of $ 8,000 we will not add anything from our pocket all that the agency car is $ 1,000, so we will make car agency is borne by the loss ..

So you will not pay anything ... We'll run away .. !!

So it really does not happen, the deal with the car agency in a manner margin has a special system that we can Nkhtzareth one sentence:

You must deposit the maximum amount that can be lost in the deal in advance with the agency cars.

How so?

To have a chance margin trading system which allows you to work most of your size ten-fold, the agency will require that cars following: open the account and has deposited the amount of $ 3,000, for example. This amount will be deposited in advance with the agency cars.

Agency will auto contrast to double your capital ten times leverage will allow you to trade a commodity in exchange to pay only a token worth ten refundable only.

You will purchase a car, since it does not need to pay only ten value, including the value of $ 10,000, but it does not need to pay $ 1,000 as a deposit refundable.

When you buy a car down payment will be deducted from your account which will deduct $ 1,000 Snsma this "User margin used margin".

Will remain in the account is now $ 2,000 unused Sensmiha "disposable usable margin margin." This amount will be the maximum amount you can lose the deal.

Thus, the agency cars to ensure that you are who will bear the loss that occurred and are not, and will not be afraid to escape because there have in your account the amount you can afford to lose.

When you order a car agency that sells the car will be implemented in the amount of $ 12,000 and the agency it would sell the car and deduct $ 10,000 value of the car and would Arbounk plus full profit and will it add to your account with your account and thus have become = $ 5,000.

But if he ordered the car agency to sell the car at a price lower than the purchase price for the transfer of $ 8,000 will be car agency implementing it and the car will sell and then deduct $ 2,000 from your account has to complete the rest of the price of the car, then would you Arbounk to your account and become your account has a $ 1,000 only.

Do you know why this method is called the work "margin trading system"?

This is because it is dealing and trading on profit and loss in trading commodity margins of what without having to pay full value, where the added profit from the deal to calculate the shops and deduct the sidelines of the loss of the account department stores.

What do you understand as well?

You understand that you can not in any transaction that you lose more than the amount in your company that allows you to margin trading system have