Margin Trading Calculator
Find buying power and borrowed funds with leverage.
e.g. 4 means 4:1
Results update as you type.
How it works
Margin trading lets you control a larger position than your own money by borrowing from your broker, and this calculator shows your total buying power and how much you borrow. You enter your account equity, the cash you actually have, and the leverage ratio your broker allows, and it returns your total buying power and the borrowed amount. Buying power is your equity multiplied by the leverage, so 4:1 leverage turns $10,000 into $40,000 of purchasing power, with $30,000 of that borrowed. Leverage magnifies both gains and losses: a position four times your equity means a small percentage move in the asset produces four times that percentage change in your equity, so a 10 percent rise gives a 40 percent gain, but a 10 percent fall gives a 40 percent loss. This amplification is why margin is powerful but dangerous. Borrowed funds accrue interest, and if losses erode your equity below the broker's maintenance margin, you face a margin call requiring you to add funds or have positions liquidated, potentially at the worst time. Understanding your buying power and borrowed amount is essential before trading on margin. This calculator covers the basic leverage math; it does not include margin interest, maintenance requirements, or fees, which vary by broker and asset. Enter your equity and leverage to compute your buying power and borrowed funds.
Buying power = equity × leverage; borrowed = buying power − equity
Buying power is your account equity multiplied by the leverage ratio. The amount borrowed on margin is the buying power minus your own equity. So with 4:1 leverage, $10,000 of equity controls $40,000 of positions, $30,000 of which is borrowed from the broker.
Source:Trading fundamentals
We review all our tools from time to time to ensure accuracy.
Worked example
How to use this calculator
- 1
Enter your values
Enter account equity and leverage ratio.
- 2
Adjust the options
Fine-tune any options to match your situation.
- 3
Read your result
Total buying power updates instantly as you type — no button to press.
Frequently asked questions
What is margin trading?
Margin trading is borrowing money from your broker to buy more of an asset than your own cash would allow, using your existing funds and securities as collateral. It increases your buying power through leverage, magnifying both potential gains and potential losses compared with trading only your own money.
How does leverage affect buying power?
Leverage multiplies your equity into buying power: at 4:1 leverage, $10,000 of equity controls $40,000 of positions. The higher the leverage, the larger the position you can take and the more you borrow. But higher leverage also amplifies losses, so buying power comes with proportionally greater risk.
What is a margin call?
A margin call happens when losses reduce your account equity below the broker's required maintenance margin. The broker demands you deposit more funds or sells your positions to bring the account back into compliance. Margin calls can force selling at a loss at the worst moment, which is a key danger of trading on margin.
Does leverage increase risk?
Yes, substantially. Because leverage multiplies your position size, it multiplies the percentage impact of price moves on your equity. A modest drop in the asset can wipe out a large share of your capital, and borrowed funds still owe interest regardless. The higher the leverage, the faster losses accumulate, so margin must be used cautiously.
Does this include margin interest?
No, this calculator shows only the leverage math for buying power and borrowed amount. Brokers charge interest on the borrowed funds, and they set maintenance margin requirements and fees that vary. Factor in the interest cost and margin rules from your broker, since they materially affect the true cost and risk of margin trading.