futures margin

Futures margin is the required deposit that traders must put down to open and maintain a futures position. It's not a full payment but a collateral holding a small percentage of the contract’s total value, ensuring both parties commit to the trade. This margin helps manage risk, as it covers potential losses if the market moves against the trader. The margin is maintained through initial margin when opening a position and variation margin which adjusts as prices change. Essentially, futures margin acts as a financial safeguard, leveraging the trader's position while limiting exposure for both parties involved.