Hi Jason!
Apart from this trade, I had the same experience today. Please take the time to go through my trades today. At 12:49 I closed all my short positions on the EUR/USD and my total equity at that moment was around 61,500. Then at 12:54 I opened two long trades on the EUR/USD (one with 5lots and one with 4 lots), so my total position was 9 lots. At 13:11 I opened another long position of 1 lot, so my total position was 10 lots. So the margin required was 56, 000 and my equity was more or less the same (around 61,500). The news came and the EUR/USD plunged immediately. It went down to 1.4210 and at 1.4218 I received a margin call for my position of 5 lots (at 13:31). My equity was sufficient enough to cover that position (around 59,000 or 58,000 the worst at the lowest levels). As I expected the EUR/USD pair to go up and as I wanted the position, I went again long with 4 (and not 5 as I wanted) lots at 13:34.However the price was significantly greater (1.42733)... This resulted in losses in my first trade and less profits on the other trade.Later on, I closed all my long positions at about 1.4315. Please take the time to go through my trades...
Please,correct me if I am wrong... I would be very happy to be wrong...:cheesy::cheesy:
I await for your reply!
P.S.: It was a pleasure talking to you, Jason
Evangelos
Hi Evangelos,
I'm a developer working on forexdesk, and I'll try to clarify what went on with your last margin call. Sorry for the delay on the reply, but hopefully it is detailed enough that it answers all the questions you might still have.
So, I went through all of your trades, and here is a slightly more detailed step by step on each of them:
- at 12:49:39, you closed your last position: your balance was exactly $ 60,494.00
- at 12:54:24, you opened a long position on EURUSD with 5 lots at best. it filled at 1.42488
- at 12:54:58, you opened another long position EURUSD with 4 lots: filled at 1.42498
- at 13:11:38, you opened another long position EURUSD with 1 lot: filled at 1.42459
Then, at 13:31:51 the EURUSD rate hit 1.42095/1.42124. That's when the platform margin called you.
To understand the required margin, lets make the calculations:
(5 + 4 + 1) = 10 lots * ((1.42095 + 1.422124) / 2) * 100k (size) / 25 (leverage) = $56,861.48 required margin
Now, remember the margin call is not run against your balance, its run against your equity, which is your balance + your profit / loss. So lets go through your positions's losses on the moment of the margin call:
first position loss = 1.42488 - 1.42095 = 39.3 pips * 5 lot = $1,965 loss
second position loss = 1.42498 - 1.42095 = 40.3 pips * 4 lot = $1,612 loss
third position loss = 1.42457 - 142095 = 36.2 pips * 1 lot = $ 362 loss
With that in mind, this is how one calculates your account's equity at the moment of the margin call:
$60,494 (balance) - $1,965 - $1,612 - $362 = $56,555 equity
Therefore, at the moment you were margin called you indeed had your equity inferior to your required margin, triggering the margin call to lower your margin so your equity would be back above your current margin requirements.
In any case, I'm glad even that didn't prevent you from winning the competition, I suppose trading close to the edge has these risks. Enjoy your prize.
Cheers,
Marcos
