Help understanding margin

December 20th, 2018, 10:23 PM

I know this has been asked many times still, after reading a lot, I found contradictory explanations about initial margin and intra-day margin and my experience using MT5 demo accounts.

I have never operated with real money yet, only with demos.

This is AMP Global broker's margins for the E-mini S&P 500 Index:

Mantainance margin: $6000
DayTrade margin: $400

As it explains in that same page an other webs this means that with a balance of $5000 I would be able to trade 12 contracts at the same time ($5000 / $400). Is that right? MT5 demo demonstrates it works that way.

But my confusion comes with an other broker, TradeStation.

That broker adds initial margin (again for e-mini s&p 500):

Initial margin: $6600
Mantainance margin: $6000
DayTrade margin: $1650 ($6600 * %25)

Reading everywhere about initial margin I understand that to operate just 1 contract I would need to have at least $6600 in my account (initial margin), and as TradeStation doesn't offer free demo accounts without funding I cannot test in advance to see how it really works.

But this calculation doesn't seem right compared to AMP Global.

So my problem is understanding initial margin properly. Some say this is the amount needed to open a trade but others say that daytrade margin is the one needed to open a trade.

Basically what I want to know is...

In TradeStation how much (if any) contracts can I operate at the same time with a $5000 balance?

And why AMP Global doesn't have an initial margin?

December 21st, 2018, 02:00 AM

Day Trading Margin: Also called Intra-Day margin is the amount needed to open a trade during normal trading hours. Need to be careful as "normal" trading hours can vary from broker to broker. Most will just say anytime the instrument in question is trading. Others will say only during US session. Check with the broker for clarification.

Initial margin: This is the margin required to hold a trade past market close on the first day you hold the contract.
Maintenance margin: This is the margin required to hold a trade past market close on any day after the first day. If a broker doesn't use Initial margin then this would be in effect the first day as well.

Help understanding margin

Discussion in Emini and Emicro Index

Help understanding margin