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Free margin is the part of your account that is not locked as margin for open trades. It equals your equity minus the margin in use, and it is the money you can put into new trades or absorb losses with.
Your equity is your balance plus or minus the profit on open trades. Used margin is the deposit the broker holds for those trades. Free margin is equity minus used margin. It changes every tick, because equity does.
You deposit $1,000 and open one mini lot of EUR/USD at 30:1 leverage. The broker locks $367 as margin. Your free margin is $633. The trade moves 20 pips in your favour, worth $20, so equity is $1,020 and free margin is $653. It then drops 60 pips against you, a $60 loss. Equity is $940 and free margin is $573. If free margin reaches zero, you cannot open new trades, and the broker starts watching your margin level.
Free margin is your buffer. When it is large, a bad move is a loss you can sit through. When it is small, the same move triggers a margin call. Traders who open many positions at once often forget that each one eats free margin, and that one adverse move can hit all of them together.
See margin, leverage and our leverage calculator, which shows how much margin a trade locks before you place it.
Margin is the deposit locked for the trades you have open. Free margin is what is left in the account after that deposit is set aside.
Yes. If losses on open trades grow larger than your free margin, the figure goes below zero, and the broker will close trades once the margin level hits its stop-out level.
Sources: MetaTrader 4 and 5 account terms as shown in the platform terminal. Checked 25 September 2026.
Risk warning: trading forex and CFDs on margin carries a high risk of losing money. Most retail accounts lose money. Never trade with money you cannot afford to lose.