Initial margin

Initial margin is the minimum collateral you must deposit to open a leveraged position. The formula is: initial margin = notional / leverage. At 10x leverage on a $5,000 notional trade, the initial margin required is $500.

Initial margin is distinct from maintenance margin. Initial margin is the entry ticket — the amount locked when you open the trade. Maintenance margin is the lower floor your equity must stay above while the position is live; it is always smaller than the initial margin. Falling below maintenance margin (not initial margin) triggers liquidation.

Example: exchange requires 1% maintenance and 2% initial margin for a given tier. You open a $20,000 notional BTC long at 50x (initial margin = $400). The position can absorb losses down to $200 (1% maintenance) before the exchange force-closes it, giving you a $200 buffer from entry to liquidation.

Exchanges often tier initial margin requirements by position size — larger notionals require higher margin ratios to limit systemic risk. Use the position size calculator to work out how much collateral a given trade requires before entering. Research output only — not investment advice.