What Is the Initial Margin and How Does It Differ from the Maintenance Margin? ⎊ Path

What Is the Initial Margin and How Does It Differ from the Maintenance Margin?

Initial margin is the amount of collateral a trader must post to open a leveraged position. It is the first required deposit.

Maintenance margin is the minimum amount of collateral required to keep the position open after it has been established. The initial margin is always greater than or equal to the maintenance margin.

The difference acts as a safety buffer against market fluctuations before liquidation is triggered.

What Is the Distinction between ‘Initial Margin’ and ‘Maintenance Margin’?

How Does “Initial Margin” Differ from “Maintenance Margin”?

How Does “Initial Margin” Differ from “Maintenance Margin” in Derivatives Trading?

Define “Initial Margin” and “Maintenance Margin.”

What Is the Primary Purpose of the Buffer between Initial and Maintenance Margin?

What Is the Difference between ‘Maintenance Margin’ and ‘Variation Margin’?

How Is “Maintenance Margin” Different from Initial Margin?

Can a Trader Withdraw Funds If Their Account Is Only at the Initial Margin Level?

Glossar

Maintenance Margin

Collateral ⎊ Within cryptocurrency derivatives and options trading, the maintenance margin represents the minimum equity a trader must maintain in their account to cover potential losses.

Initial Margin

Collateral ⎊ Initial margin represents the equity a trader must deposit with a broker or exchange as a good faith commitment to cover potential losses arising from derivative positions, notably within cryptocurrency markets.