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The MF Global Avalon FX Pro 4.5 trading platform calculates Initial Margin Requirement in real-time.  When opening a new position, the system will apply the Initial Margin Rate to the contract size in US$.  Based on the total number of lots opened, the Initial/Maintenance Requirement in US$ is calculated for the position.

 

For example, a 2 lot position opened in EUR/USD (margined at 3%) at 1.34 would require the following amount of Initial Margin Requirement in US$:

 

3% X 100,000 EUR X 1.34 X 2 = US$8,040.

 

Once the trade is opened, the amount of US$8,040 in Initial Margin Requirement is carried in the account as the Maintenance Margin Requirement for this position in the account until the position is closed.

 

Please see the following Initial, Maintenance and Liquidation Margin Rates currently applicable to the currency pairs available on the MF Global Avalon FX Pro 4.5:

 

Currency Pair	Initial/Maintenance Margin	Liquidation Margin
USD/CHF	3%	0.30%
GBP/USD	3%	0.30%
USD/JPY	3%	0.30%
EUR/USD	3%	0.30%
USD/CAD	3%	0.30%
AUD/USD	3.30%	0.33%
NZD/USD	3.60%	0.36%
AUD/JPY	6.30%	0.63%
CAD/JPY	3%	0.30%
EUR/CHF	6%	0.60%
EUR/GBP	6%	0.60%
EUR/JPY	6%	0.60%
GBP/JPY	6%	0.60%
NZD/JPY	6.60%	0.66%
EUR/CAD	3%	0.30%
GBP/CAD	3%	0.30%

 

Please review the Avalon FX Pro Execution Risk Disclosure.

Maintenance Margin is the amount of margin required to maintain open currency positions on the MF Global Avalon FX Pro 4.5 trading platform. In addition to being affected by deposits and withdrawals, available margin in the account can increase with realized gains on closed positions and unrealized gains on open positions.  Conversely, it can decrease with realized losses on closed positions and unrealized losses on open positions.

 

When account equity falls below Maintenance Margin, no new positions are allowed (as there is insufficient margin to enter new positions) and the account enters into “liquidation only¨ mode. At this time an email message titled “Urgent! Margin Call Warning” will be sent via system message and appear in the Mailbox Window. This Maintenance Margin Warning will also be sent to the email address registered to the account.

A message with real-time data will also appear at the bottom of the Trade Window: “Margin Call; Liquidation Time: MM/DD/YYYY HH/MM/SS AM/PM; Minimal Deposit: $XXX”.* In the Account Summary Bar at the bottom of the trading platform, a tab stating: “Free margin: 0.00 Margin Call” will appear in orange.

 

 

Balance – Actual cash balance adjusted for deposits and withdrawals, realized profits and losses, fees and commissions if applicable.

Margin – Maintenance Margin required on all open positions.

Free margin – Equity minus Margin equals available margin to open new positions. 

Equity – Balance adjusted for Unrealized Profit/Loss (UPL)

UPL - Unrealized Profit/Loss on open positions.

 

The Margin Call status of the account is automatically reset in real-time when sufficient margin funds are restored, so that account equity once again exceeds Maintenance Margin required for all open positions.  This may occur under one or more of the following circumstances:

 

1. additional funds are deposited,

2. positions are reduced; or partially or fully closed,

3. market recovers in favor of the trader.

In some instances, account equity may dip below Maintenance Margin momentarily, triggering a Maintenance Margin Warning, and then rises above the requirement again within minutes, or even seconds.  In fact, account equity may continue to fluctuate above and under Maintenance Margin Requirement. Under these circumstances, there will be no email notification of a Margin Call Warning if an email was sent within the past hour.

 

Please keep in mind that an account is subject to Maintenance Margin Call if margin is not restored to a sufficient level to satisfy Maintenance Margin Requirement by the deadline which is usually 72 hours from the last email notification.  If at any time account equity is below Liquidation Margin Requirement, which is 10% of Maintenance Margin Requirement, all open positions are subject to immediate Liquidation Margin Call without further warning. Please review the MF Global FX Margin Policy & Procedures.

 

Margin requirements are subject to IIROC regulation and may change at anytime without notice. MF Global FX may set higher margin requirements based on account size, simultaneous open positions, trading style, market conditions, etc. It is the trader's responsibility to ensure there is sufficient margin in the account at all times.

 

Please review the Avalon FX Pro Execution Risk Disclosure.

 

*Please note that the Minimal Deposit required to restore sufficient Maintenance Margin to the account may change according to the UPL.  Although Minimal Deposit is calculated as the shortfall of Equity against Margin, it is recommended that an amount exceeding the Minimal Deposit be deposited to rectify the shortfall.