HFM (formerly HotForex): What is the required margin for FX? A complete explanation of the calculation method and leverage limits for all account types。The required margin for overseas FX trading on HFM (HotForex) is related to the maximum leverage and the amount deposited, so I will explain it in this article. If you are trading with MT4 or MT5, you will come across the term “required margin”. This term is common, but those who have just started trading may not understand it, so I will explain the meaning of the term and how to calculate it.
- HFM Basic Information
- What is HFM Margin? Understanding the Basic Concept
- HFM Margin List: All Currency Pairs
- Characteristics of Cryptocurrency Margin
- Margin Required for Precious Metals Trading
- Margin for Energy Products
- Stock CFD Margin and Trading Strategy
- Understanding Bond Futures Margin
- The Importance of Risk Management and Margin
HFM Basic Information
| Company Name | HF Markets（SV） Ltd. |
| Year of establishment | 2010 |
| Service Overview | A large brokerage providing services in over 180 countries worldwide with millions of registered accounts |
| Financial products handled | Foreign Exchange (FX), Stock Indices/Commodities, Stock CFDs/Cryptocurrencies |
| Trading Platform | MetaTrader 4（MT4）、MetaTrader 5（MT5） |
| Maximum Leverage | 2,000x |
| User Support | Multilingual support |
| Financial License | ✔ FCA (UK, Financial Conduct Authority) ✔ FSCA (South Africa) ✔ DFSA (Dubai) ✔ FSA (Seychelles) |
| Deposit and Withdrawal Methods | Bank transfer Credit/Debit card (VISA/Master/JCB, etc.) bitwallet / BXONE / Binance Pay / Cryptocurrency |
| Account Type | Cent Account Premium Account Pro Account Zero Account Top-up Bonus Account |
What is HFM Margin? Understanding the Basic Concept
In HFM (formerly HotForex), margin refers to the funds deposited in your account as collateral for FX and CFD trading.
Misunderstanding how it works can lead to unexpected stop losses,
so here’s a simple explanation of the basics.
When starting to invest, you should consider economic indicators and other factors and remain vigilant until your trade is completed. Please refer to the Terms of Use and FAQs on the home page.
① What is Margin?
Margin is the “security deposit” required for trading.
With HFM,
small capital
high leverage
allows you to open positions significantly larger than your actual trading amount.
Margin is required for this.
② The Relationship between HFM Leverage and Margin
Margin and leverage are two sides of the same coin. It’s an accurate representation of how to make profits in the US dollar, euro, Japanese yen, and other currencies. Consider not only pips but also costs. This also applies to Ethereum, Bitcoin, and other currencies. Always check your account details on your My Page screen.
Calculation Example
Required Margin = Trading Amount ÷ Leverage
Example
10,000 USD/JPY (approximately ¥1.5 million)
Leverage: 1,000x
👉
¥1,500,000 ÷ 1,000 = approximately ¥1,500
Large trades are possible with a small margin, but it’s important to note that losses also increase by the same factor.
③ Important Margin-Related Terms for HFM
When trading with HFM, be sure to understand the following.
① Equity
Account Balance ± Unrealized P&L
👉 Actual funds available.
② Margin
The margin required for currently held positions.
③ Free Margin
Equity – Required Margin
👉 The margin that can withstand new trades and losses.
④ Margin Level
(Equity ÷ Required Margin) x 100
👉 The most important indicator.
④ HFM Margin Call and Stop Loss
In HFM, the following events are triggered depending on the margin maintenance level.
Margin Call: When the maintenance level falls below a certain level.
Stop Loss: Forced liquidation if the margin level falls further.
👉 Since the figures vary depending on the account type and product,
it is essential to maintain a margin level at all times.
⑤ Basic Rules for Safe Margin Management
Beginners can avoid mishaps by keeping the following in mind.
Aim for a margin maintenance ratio of 300-500% or higher.
Avoid single losses of 1-2% of your account capital.
Avoid full leverage.
Lighten your positions before important indicators.
⑥ Common Misconceptions
❌ “High leverage = risk.”
⭕ “Dangerous if used improperly.”
High leverage is a tool to increase capital efficiency.
It can be either safe or dangerous depending on your risk management.
HFM Margin List: All Currency Pairs
HFM’s officially published “Margin List for All Currency Pairs (a list of fixed margin requirements for each currency pair)” is not currently available as a list on the HFM official website. In HFM, margin for each currency pair is expressed as a leverage (margin rate), and the actual required margin amount is calculated in real time based on the exchange rate, lot size, and selected leverage.
📌 Understanding HFM Margin for Each Currency Pair
In HFM, a “required margin percentage” and “maximum leverage” are set for each currency pair, and the required margin is automatically calculated using the following formula:
Required Margin = (Trading Volume × Exchange Rate) ÷ Applied Leverage
Example:
EUR/USD 1 Lot (100,000 units)
Account Leverage 1:400
Exchange Rate 1.21745
👉 Required Margin ≒ USD 3,043.63 (approximately $3,043)
📍 How to Check Margin by Currency Pair (Recommended)
Since HFM does not officially publish a list, you can check the margin rate and required margin for each currency pair below:
Margin amount automatically displayed when opening a position within the MT4/MT5 platform
→ Enter your trade size to calculate the required margin.
HFM’s official currency pair trading conditions page
→ Maximum leverage and spreads for each tradable currency pair may be listed.
Contact HFM support directly
→ You can request a table of margin rates (%) for each individual pair.
Characteristics of Cryptocurrency Margin
The characteristics of margin in cryptocurrency (virtual currency) trading are significantly different from those in FX and stock CFDs. Failure to properly understand these differences can lead to sudden liquidation.
Here, we will focus on essential characteristics and points to note.
① Cryptocurrency margin has “very high fluctuation risk.”
The biggest characteristic is its extremely high price volatility.
Prices can move by several percent to tens of percent in a matter of minutes.
Sudden fluctuations can occur even on weekends and late at night.
Sudden rises and falls can occur even without indicator announcements.
👉 As a result,
margin maintenance ratios are prone to sudden drops.
② Leverage is set lower than FX.
Many brokers (including HFMs) offer the following leverage:
FX: Up to several hundred to several thousand times
Cryptocurrency CFDs: Around several to several dozen times
Cryptocurrencies have lower leverage.
Reasons
Prices fluctuate dramatically.
Liquidity changes dramatically depending on the time period.
High risk of loss during sudden changes.
👉 In other words,
Instead of being unable to make large bets with a small margin, the design minimizes risk.
③ Margin requirements may be suddenly increased.
This is an important point specific to cryptocurrencies.
Sudden fluctuations
Important news
When market liquidity declines, brokers may
👉 temporarily increase margin requirements
👉 reduce effective leverage.
⚠️ As a result,
additional margin may be required.
Maintenance rates may drop sharply, triggering a stop loss.
A situation where a stop loss occurs even when the price is not moving can also occur.
④ Cryptocurrencies reflect unrealized losses very quickly.
With cryptocurrency CFDs,
unrealized gains and losses are reflected immediately.
Spread widening occurs suddenly.
As a result,
equity may fluctuate instantaneously.
👉 It’s dangerous not to constantly monitor your margin maintenance ratio.
⑤ Trading hours are 24/7.
This has both advantages and risks.
Advantages
Trading is possible on weekends.
Many opportunities.
Risks
Rapid fluctuations while you sleep.
Large gaps can occur on weekends.
👉 Abandoned positions can easily lead to margin risk.
Margin Required for Precious Metals Trading
Margin required for precious metals (e.g., gold, silver) trading is typically higher and more volatile than for FX.
Here, we’ll explain the mechanism, calculation method, and practical guidelines.
① What is margin for precious metals trading?
Precious metals (e.g., XAUUSD = gold, XAGUSD = silver) are traded as CFDs,
and require collateral (margin) to maintain positions.
Characteristics include:
Large price fluctuations
Prone to sudden fluctuations
Sensitive to geopolitical risks, interest rates, and inflation
👉 Margin requirements tend to be higher than for FX.
② How to calculate margin requirements for precious metals
The basic formula is the same as for FX.
Margin Required = Trade Size × Current Price ÷ Leverage
Gold (XAUUSD) Example
Trade Size: 1 Lot (100 oz)
Gold Price: USD 2,000
Leverage: 100x
100 × 2,000 ÷ 100 = USD 2,000
👉 Approximately USD 2,000 in margin is required.
Silver (XAGUSD) Example
Trading Size: 1 Lot (5,000 oz)
Price: 25 USD
Leverage: 100x
5,000 × 25 ÷ 100 = 1,250 USD
③ Reasons for High Margin Requirements in Precious Metals Trading
1️⃣ High Volatility
Gold can move by tens of dollars in a single day
Margin Maintenance Ratios are Suddenly Decreased
2️⃣ Margin Requirements May Be Raised
US Employment Statistics
FOMC
When Geopolitical Risks Occur
👉 Brokers May Temporarily Increase Margin Requirements
3️⃣ Widening Spreads
Unrealized Losses Increase at Critical Times
Equity Margin Decreases Suddenly
Margin for Energy Products
Margin for energy products (crude oil, natural gas, etc.) is characterized by its volatile nature and high management difficulty compared to FX and stock indices.
This article provides a systematic explanation of the mechanisms, calculation methods, points to note, and practical guidelines.
① What is margin for energy products?
Energy products are primarily offered as CFDs (contracts for difference), with representative examples including:
WTI crude oil (USOIL)
Brent crude oil (UKOIL)
Natural gas (NGAS)
👉 Margin is the collateral required to trade these products.
② Basic formula for required margin
The formula is the same as for FX and precious metals, but the important point is that the value of one lot is larger.
Margin Required = Trading Quantity × Current Price ÷ Leverage
WTI Crude Oil (USOIL) Example
1 Lot: 1,000 Barrels
Crude Oil Price: USD 80
Leverage: 100x
1,000 × 80 ÷ 100 = USD 800
👉 Approximately USD 800 in margin is required.
Natural Gas (NGAS) Example
1 Lot: 10,000 MMBtu (dealer specifications)
Price: USD 3
Leverage: 50x
10,000 × 3 ÷ 50 = USD 600
👉 Pay attention to lot specifications and volatile price fluctuations when trading natural gas.
③ Reasons for High and Unstable Margin Requirements for Energy Products
1️⃣ Extremely Volatility
Crude oil prices can fluctuate 5-10% in a single day.
Natural gas prices can fluctuate dramatically within a few hours.
👉 Margin maintenance requirements tend to drop suddenly.
2️⃣ Margin requirements are increased during important events.
OPEC Meeting
Crude Oil Inventory Statistics (EIA)
Geopolitical Risks (War, Sanctions)
👉 Brokers may temporarily reduce leverage.
3️⃣ Impact of Rollover and Expiry Dates
Because CFDs reference futures prices,
Price adjustments at contract month rollovers
Expanded spreads
can occur, resulting in unexpected margin reductions.
Stock CFD Margin and Trading Strategy
Stock CFD margin is directly linked to your trading strategy.
Treating stock CFDs in the same way as FX or commodity CFDs can easily lead to unexpected stop-losses and poor capital efficiency.
This article provides a systematic explanation of margin mechanisms, characteristics, and how they can be applied to your strategy.
① Basics of Stock CFD Margin
Stock CFDs are trades where you buy and sell individual stocks on a cash-for-difference basis.
You do not actually own the stocks.
Trading is possible with small amounts of margin.
Both buying (long) and selling (short) are possible.
👉 Margin is the collateral required for trading.
② Calculating the Required Margin for Stock CFDs
The basic formula is the same, but margin rates are higher than for FX.
Margin Required = Stock Price × Number of Shares ÷ Leverage
Or
Margin Required = Stock Price × Number of Shares × Margin Rate
Example
Stock Price: 100 USD
Number of Shares: 100 shares
Margin Rate: 20% (5x Leverage)
100 × 100 × 0.20 = 2,000 USD
👉 A margin of $2,000 is required.
③ Characteristics of Stock CFD Margin
1️⃣ Margin rates are high and vary by stock.
Generally 10-30%
Higher volatility stocks result in higher rates.
👉 Be careful with tech and small-cap stocks.
2️⃣ Margin requirements are increased due to important events.
Earnings Announcements
M&A News
Regulations/Litigation
👉 Effective leverage is likely to decrease around the time of earnings announcements.
3️⃣ Gaps (gaps) are common.
Stock markets have limited trading hours.
Significant price movements at the opening.
👉 Margin maintenance ratios can collapse in an instant.
Understanding Bond Futures Margin
Bond futures margin is quite different in nature from FX and stock CFDs.
It is an area where risk can easily be misjudged without an understanding of interest rate fluctuations, leverage, and institutional rules.
This section explains the basic structure, margin characteristics, and practical considerations.
① What are bond futures? (Understanding the premise)
Bond futures are contracts to buy and sell specific government bonds at a set price at a specific time in the future.
Representative examples:
U.S. Treasury futures (2-year, 5-year, 10-year, 30-year)
German Bund futures (Bund)
Japanese Government Bond futures (JGB)
👉 Prices move inversely to interest rates.
② What is bond futures margin?
Bond futures margin is collateral representing the ability to fulfill the contract.
It is a portion of the actual transaction amount (notional amount) and is characterized by being very small compared to the notional amount.
③ Characteristics of Bond Futures Margin
1️⃣ The notional amount is very large.
Example (10-Year U.S. Treasury Note futures):
Notional amount: Approximately $100,000
Margin requirement: Approximately several thousand dollars
👉 This indicates a highly leveraged product.
2️⃣ Margin is not “fixed.”
Margin fluctuates due to the following:
Market volatility
Interest rate events (FOMC, CPI, etc.)
Exchange risk assessment
👉 Margin may be suddenly increased.
3️⃣ Daily “Mark-to-Market”
Bond futures
P&L is confirmed daily.
Unrealized P&L is not carried over to the next day.
👉 Losses necessitate additional margin calls.
④ Types of Margin (Important)
▶ Initial Margin
Required to open a position
Set by the exchange
▶ Maintenance Margin
Required to maintain a position
A margin call will occur if this margin falls below this limit
▶ Variation Margin
Daily determined profits and losses
Essentially cash settlement
The Importance of Risk Management and Margin
The importance of risk management and margin is paramount in any market (FX, CFDs, cryptocurrencies, futures), determining whether you can survive to your limits.
This is a foundation that must be understood before methods or market outlooks. Log in to learn more about product calculations and changes, and use the latest information to make the most of your investments.
① Why is “margin management” the core of risk management?
Margin is not simply “money for trading,” but
👉 a breakwater to withstand losses.
Even with the same trading method,
If you have sufficient margin, you can continue.
If you don’t have sufficient margin, you’ll exit due to a temporary reversal.
The results will be completely opposite.
② Typical mistakes that occur when margin is neglected
❌ Reliance on full leverage
Trying to win big with a small amount
Limiting losses after a slight reversal
❌ Not designed to withstand unrealized losses
Leaving the position thinking “it will bounce back”
Forced liquidation due to a sudden drop in maintenance rate
❌ Ignoring event risk
Indicators, financial results, and statements by important people
Raising margin requirements → Forced margin cut
③ Predetermining maximum loss
Limiting loss price
Maximum expected reversal
Stopping rules for losing streaks
👉 Eliminating emotional interference.
④ Why margin management stabilizes your mental state
Having sufficient margin allows you to
Evaluate unrealized losses calmly
Limiting losses according to the rules
Preventing reckless trades to make up for lost time
👉 Money management = mental management
⑤ “Designing for Ruin Prevention” Over “Win Rate”
Many beginners focus on
Win Rate
Entry Accuracy
But what professionals prioritize most is
👉 Reducing the Probability of Ruin
.
You can survive with a 40% win rate.
You can go bankrupt even with a 70% win rate.
The difference is all about margin management.
⑥ Practical Margin Management Checklist
Simply checking this before trading can prevent disasters.
☑ What’s the maximum percentage loss you can expect with this lot?
☑ To what percentage will your maintenance rate drop?
☑ Can you tolerate unexpected events?
☑ Do you have a rule for stopping after a losing streak?
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