Margin
Margin is the portion of your account set aside as collateral while a leveraged position is open. It is not a fee — it is locked when the trade opens and released when it closes.
Required margin equals notional value divided by leverage. Half a lot of EURUSD at 1.1000 has a notional value of $55,000; at 1:100 that requires $550. Platforms show three related figures: used margin (the total locked), free margin (equity minus used margin), and margin level (equity divided by used margin, as a percentage).
If losses pull equity down toward the used margin, the platform issues a margin call and, below a stop-out threshold, starts closing positions automatically. In practice this is a last-resort backstop, not a risk plan.
Example
Balance $10,000. You open 0.50 lots of EURUSD, locking $550 of margin at 1:100. The trade floats at −$120, so equity is $9,880 and free margin is $9,880 − $550 = $9,330. Close the trade and the $550 is released back to free margin.
In a prop-firm challenge
On an evaluation account you will normally hit the firm's rules long before a stop-out: a 4–5% daily loss limit or a 10% max drawdown ends the attempt while margin level is still comfortable. Margin math tells you what you can open; the rulebook decides what you can survive, as laid out in drawdown types explained.