Margin utilisation (MU) is the percentage of margin collateral that a client uses for buying on margin (using leverage). If the margin utilisation exceeds 100%, a margin call will be initiated, and there is a risk that margin positions will be stopped out (i.e. reduced or liquidated).
Margin Utilisation is calculated as = (100 * Used for margin) / (Account value + Other collateral – Not available as margin collateral).
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Example |
For example, Account Value (NAV) = 29,968.80 (Total Cash Balances or 7,552.38 + Total Trades Value or 22,416.41) Total funds Used for Margin are 7038.92, thus: MU% = 23% (7,038.92 / 29,968.80) |
EXANTE applies 2 types of leverage rates for the instruments:
Standard leverage rate indicates the percentage of the asset value blocked as a margin. Thus, a 30% Leverage Rate blocks 30% of the asset's value as Used for Margin in the account.
Concentration Rate indicates when the penalty rate for the concentration of a certain position will be applied and the penalty itself. Concentration Rate of 50% means that if a position in a single asset exceeds 50% of the total Account Value, that position is then considered Concentrated, and the per cent of funds blocked for margin will increase to the Concentration Rate value. More information on Concentration Rate can be read here.
Margin report is a module in the EXANTE trading platform that allows you to track not only the total sum and proportion of leverage but also the entire structure of the current margin, depending on traded assets. To access the module, open the EXANTE desktop platform and click Margin Report on your top toolbar.