m.Stock Futures Margin Calculator

What Is Margin in Futures Trading? 

So far, we’ve seen that futures contracts allow you to trade based on price movements whether the market goes up or down. But another important feature of futures trading is leverage. 

What Is Leverage? 

Leverage means that you can gain exposure to a large position while investing a smaller amount upfront. In simple terms, with ₹100, you could control an asset worth ₹200, ₹500, or even more, depending on the margin requirements. 

For example: 

• If you have 5x leverage, your ₹100 can control a position worth ₹500. 

• If the asset increases from ₹100 to ₹110, your profit becomes ₹50, not ₹10, thanks to the leverage. 

• However, leverage works both ways. If the asset drops from ₹100 to ₹90, the loss is ₹50, not ₹10. 

Leverage = Margin in Stock Broking 

In trading terms, the margin is the capital required to open a leveraged futures position. It is a safety net that ensures you have enough funds to cover potential losses.  

Key Points to Understand About Margin 

• Exchanges require you to maintain a minimum margin to initiate a futures trade 
• This margin protects against losses and ensures your position is backed by adequate capital 
• If your position starts generating a loss that eats into your margin, you’ll receive a margin call, a request to top up your margin balance 

Let’s Understand Margin with an Example 

Imagine you want to buy Reliance Industries futures with the nearest expiry. 

• The lot size is 250 shares 

• If the futures price is ₹2,450, your total exposure is ₹6.12 lakh (₹2,450 × 250 shares) 

• However, the margin required might only be around ₹1.33 lakh 

• This means your leverage is approximately 4.6 times (₹6.12 lakh ÷ ₹1.33 lakh) 

This is how margin works, it enables you to control large positions with comparatively smaller capital. 

How to Use m.Stock’s Futures Margin Calculator 

To quickly check the margin required for any futures contract, you can use the m.Stock SPAN Margin Calculator. It’s a simple, effective tool that helps you plan your trades better. 

Steps to Calculate Margin Using m.Stock: 

1. Visit the Margin Calculator section on the m.Stock platform 

2. Select the segment you want to trade in (Futures, Index and stocks.) 

3. Enter contract details like expiry, quantity, and action