
How is CFD Tiered Margin Calculated?
1. What is tiered margin?
In a nutshell, the larger the position, the higher the margin rate.
Previously, no matter how large a position you opened, a single fixed margin rate applied across the board. With the updated system, positions are divided into tiers based on their value. Each tier has its own margin rate, with lower tiers requiring less margin and higher tiers requiring more margin. If your position spans multiple tiers, each tier is calculated separately, and the results are added together.
Similar logic: Tax brackets
This works exactly like a personal income tax bracket system. Not your entire income will be subject to a high tax rate. The amount up to a threshold, such as $100,000, is taxed at a lower rate, and only the portion above that threshold is taxed at a higher rate. Tiered margin follows the same logic.
2. XAUUSD position tiers
XAUUSD tiered margin rates during regular trading hours (notional exposure calculated in USDT):
| Tier |
Exposure range (USDT) |
Margin rate |
Corresponding maximum leverage |
| Tier 1 |
0–10,000,000 |
0.20% |
500× |
| Tier 2 |
10,000,000–20,000,000 |
1.00% |
100× |
| Tier 3 |
20,000,000–40,000,000 |
10.00% |
10× |
| Tier 4 |
40,000,000–100,000,000 |
20.00% |
5× |
| Tier 5 |
> 100,000,000 |
50.00% |
2× |
Notional exposure = number of lots × contract size (100 ounces) × current price × exchange rate
3. Calculation details
3.1 Calculate the notional exposure
Notional exposure represents the total market value of your position and reflects the amount of market assets you actually control.
Notional exposure (USDT) = number of lots × contract size × current price × exchange rate
For XAUUSD, the exchange rate is fixed at 1 because the quote currency is USD.
3.2 Determine the highest tier you fall into
Compare the notional exposure you calculated against the tier table above to determine which tier it falls into. This is your highest tier.
All tiers below the highest tier are calculated at their full tier cap. Only the highest tier is calculated based on the actual amount exceeding the previous tier's upper limit.
3.3 Calculate margin tier by tier and add the results
Margin per tier = actual exposure in that tier × tier margin rate
Used margin = tier 1 margin + tier 2 margin + … + highest tier margin
4. Calculation examples
-
Scenario 1: Open a position of 10 lots (tier 1 only)
Step 1: Calculate the notional exposure
Notional exposure = 10 lots × 100 ounces × 4000 USD = 4,000,000 USDT
Step 2: Determine the tier
4,000,000 < 10,000,000, so the highest tier is tier 1, with a margin rate of 0.20%.
Step 3: Calculate the margin
Calculate XAUUSD margin tier by tier | 10 lots
Tier 1 margin = total exposure of 4,000,000 × 0.20% = 8000 USDT
Total used margin: 8000 USDT
-
Scenario 2: Open a position of 60 lots (multiple tiers)
Step 1: Calculate the notional exposure
Notional exposure = 60 lots × 100 ounces × 4000 USD = 24,000,000 USDT
Step 2: Determine the tier
20,000,000 ≤ 24,000,000 < 40,000,000, so the highest tier is tier 3.
Therefore, tier 1 and tier 2 margins are calculated at their full tier caps. Tier 3 margin is calculated only on the amount exceeding the tier 2 upper limit (24,000,000 − 20,000,000 = 4,000,000).
Step 3: Calculate margin for each tier
Calculate XAUUSD margin tier by tier | 60 lots
Tier 1 margin = 10,000,000 × 0.20% = 20,000 USDT
Tier 2 margin = 10,000,000 × 1.00% = 100,000 USDT
Tier 3 margin = 4,000,000 × 10.00% = 400,000 USDT
Total used margin: 520,000 USDT
Opening a position of 60 lots of XAUUSD means you have a notional exposure of 24,000,000 USDT | spanning 3 tiers
Comparison: Under the old flat margin rate of 0.20%, 60 lots would require 24,000,000 × 0.20% = 48,000 USDT. However, under the tiered system, 520,000 USDT is required, approximately 10.8× more. The larger the position, the more pronounced the difference. Make sure to monitor your available margin before opening positions.
-
Scenario 3: Positions enter a special period, and all positions are recalculated after opening a new position
Requirements
XAUUSD price: $4000 per ounce | Contract size: 100 ounces per lot
Tier 1 margin rate during regular trading hours: 0.20%
Uniform margin rate during special periods: 1.00% (for gold, no tiers)
Timeline
Regular hours | Existing positions
Hold 10 lots of XAUUSD. Notional exposure: 4,000,000 USDT, falling into tier 1.
Used margin = 4,000,000 × 0.20% = 8000 USDT
Enter a special period (30 minutes before market close)
The margin rate becomes 1.00%. However, since no position change occurs at this moment, margin is not recalculated, and your account remains in its current state.
Open a position of five lots during the special period
A position change occurs → margins for all open positions in the account are recalculated at the uniform special period margin rate of 1.00%.
New total positions = 10 + 5 = 15 lots. Notional exposure = 6,000,000 USDT (still in tier 1).
Recalculated used margin
Special period | Recalculate margin for all open XAUUSD positions | 15 lots | Margin rate of 1.00%
Notional exposure = 15 × 100 × 4000 = 6,000,000 USDT
Uniform margin rate of 1.00% during special periods
Total used margin = 60,000 USDT
Before-and-after summary
| Period |
Position size (lot) |
Notional exposure |
Margin rate |
Used margin |
| ① Regular trading hours (before opening new positions) |
10 lots |
4,000,000 USDT |
0.20% |
8000 USDT |
| ② Special period (no action taken) |
10 lots |
4,000,000 USDT |
No recalculation |
8000 USDT |
| ③ After opening a position of 5 lots during the special period |
15 lots |
6,000,000 USDT |
1.00% |
60,000 USDT |
Key takeaway: From ① to ③, only five lots were added, yet the required margin jumps from 8000 USDT to 60,000 USDT, which is an increase of 52,000 USDT. This is because all open positions, including the original 10 lots, are recalculated at the special period uniform rate of 1.00%. If you have insufficient margin in the account, the new order will be rejected, and a margin warning may be triggered for the whole account.
5. FAQ
(1) If the price moves while I'm holding a position, will my margin requirement change?
No. The margin required for existing positions does not change with price fluctuations. The required margin is locked in at the time of opening and remains fixed for the life of the position, and price movements do not trigger a recalculation.
However, price movements will affect your unrealized PnL. When the market moves in your favor, your account equity rises, and your risk ratio improves. When it moves against you, your account equity falls, and your risk ratio deteriorates. So even though the margin itself has not changed, a significant adverse price move can push your risk ratio toward the warning threshold. Make sure to top up your available margin in a timely manner.
(2) Will closing a position always reduce my margin requirement?
Not necessarily. It depends on your overall position structure after the close. CFD trading allows you to hold both long and short positions in the same instrument simultaneously. The platform calculates margin as follows:
Margin is charged only on the side with the larger net exposure. The side with the smaller net exposure does not incur additional margin.
Example: You hold 10 lots long and 6 lots short in XAUUSD. Margin is calculated on the long side (10 lots). The short side (6 lots) incurs no additional margin. At this point, if you:
-
Close part of the long side (e.g., close 3 long lots): The long position drops to 7 lots, still larger than the 6-lot short position. Margin continues to be calculated based on the long position, so the margin requirement decreases.
-
Close part of the short side (e.g., close 2 short lots): The short position drops to 4 lots, widening the gap, but the dominant side (10 lots long) is unchanged, so the margin requirement stays the same.
In short, whether closing a position frees up margin depends on whether you're reducing the dominant side or the smaller side.
(3) Where can I view my account risk ratio and the applicable margin rates?
Account risk ratio: Log in and go to the trading page to view your real-time risk ratio and current margin usage.
Current margin rate: On the trading page, enter the number of lots you intend to open, then select the info icon next to the Used Margin field to see the tier-by-tier margin rate breakdown for that position size.
Note: Estimated margin shown on the trading page is an estimate for the new position only and does not account for existing open positions. For the actual impact on your overall account margin, refer to the data in the trading interface.
Summary: The core principle of tiered margin is progressive tier-by-tier accumulation. Lower-tier exposure is charged at a lower rate, while higher-tier exposure is charged at a higher rate, rather than applying the highest rate to your entire exposure. The larger your position, the more exposure falls into higher tiers, and the faster your total margin requirement grows. We recommend confirming the estimated margin required on the trading page before opening a position to ensure your account has sufficient funds.
- 1. What is tiered margin?
- 2. XAUUSD position tiers
- 3. Calculation details
- 4. Calculation examples
- 5. FAQ


