In plain English
What Used margin means
Used margin is an account-status measure, not a separate cash charge. A platform totals the applicable margin requirement for positions and may apply special rules for hedged positions, opposite-direction orders, or correlated instruments. The result can therefore be lower or higher than a simple sum of each trade’s opening margin.
Why it matters
Comparing used margin with equity helps show how much of the account is committed to supporting existing exposure. As used margin rises, free margin generally falls. That leaves less capacity for new positions and less cushion before a broker’s margin-warning or close-out mechanism can apply.
Example
Assume account equity is $5,000. Two open positions require $900 and $600 of margin under the broker’s rules, so used margin is $1,500. Ignoring reserved funds and other adjustments, free margin is $3,500 ($5,000 − $1,500). A later change in requirements could increase used margin without a new trade.
Quick answers
Common questions
Is used margin removed permanently from the account balance?+
No. It is generally a required allocation or lock for as long as the relevant positions or orders remain open. When the requirement is released, it becomes available again subject to current account conditions.
Why can used margin change after a trade is opened?+
The broker may recalculate requirements using current prices, exchange rates, volatility settings, instrument rules, or netting and hedging treatment. A position change, pending order, or revised house requirement can also alter it.
Sources