Margin Call Calculator

A margin call happens when you have borrowed money from a broker to buy investments and the value of those investments falls far enough that your equity drops below the broker's required minimum. The broker then demands you add funds or sell holdings to restore the minimum. If you cannot, the broker can sell your positions - often at the worst possible time - to protect its loan. It is one of the fastest ways leverage can turn a loss into a wipeout.

Leverage means using borrowed money to increase the size of your position beyond what your own cash would allow. It magnifies gains when prices rise, but it magnifies losses just as much when they fall - and you still owe the loan regardless. A relatively small adverse move can erase your invested capital entirely. This calculator shows the price at which a margin call is triggered so you can see how little room highly leveraged positions leave.

It is derived from how much you borrowed, the value of your position, and the broker's maintenance-margin requirement - the minimum equity percentage you must keep. As the price falls, your equity shrinks; the margin-call price is the level at which it hits that minimum. The more you borrow relative to your own money, the closer the call price sits to your entry, meaning less adverse movement is needed to trigger it.

For most long-term investors, no. Margin adds a layer of risk that can force you out of a position at a loss and even leave you owing more than you invested. This tool is educational, to illustrate the mechanics and danger of leverage, not an encouragement to use it. If you are considering margin, be certain you understand the risks and can withstand a forced liquidation.