Locked positions and margin: why the same hedge costs different amounts on different brokers
Posted: Sat Oct 31, 2026 11:00 am
Open a buy and a sell of equal size on the same symbol and the net market exposure is zero. Whether the margin requirement is also zero depends entirely on the broker's rules, and this is where scalpers running locks get surprised.
Three treatments show up in practice.
The first charges full margin on both legs. The platform simply sums the requirement of every open position, so a locked pair uses twice the margin of a single position. It is the simplest model and the least friendly.
The second charges margin only on the larger side. Equal legs mean the locked pair costs the same as one leg, and an unequal pair costs margin on the bigger leg only. Plenty of retail brokers use some form of this.
The third offers a reduced or even zero margin for the matched portion, sometimes with a small fraction left over. Wording like "hedged margin" or "margin for locked positions" in the contract specification is the clue.
What changes in practice:
- Free margin after locking. Under the first model it drops the moment the second leg opens, which can trigger a margin call on a nearly maxed account despite zero net risk.
- Stop out behavior. Some platforms close positions in a particular order, such as largest loss first, and that can break the lock and leave a naked leg at the worst possible moment.
- Cross-pair hedges. A long on one pair and a short on a correlated pair is not a lock in the margin engine's eyes, so no offset applies even if the exposure feels hedged.
- Account currency conversion. The reduction is calculated on the broker's side, so the displayed number can differ from a manual calculation.
The details sit in the contract specifications and the account terms, and they can differ between account types at the same broker. Opening a small locked pair and watching what happens to used margin is a cheap way to find out the real rule instead of trusting a summary page.
Which model has shown up on your account, and has the stop out order ever broken a lock on you?
Three treatments show up in practice.
The first charges full margin on both legs. The platform simply sums the requirement of every open position, so a locked pair uses twice the margin of a single position. It is the simplest model and the least friendly.
The second charges margin only on the larger side. Equal legs mean the locked pair costs the same as one leg, and an unequal pair costs margin on the bigger leg only. Plenty of retail brokers use some form of this.
The third offers a reduced or even zero margin for the matched portion, sometimes with a small fraction left over. Wording like "hedged margin" or "margin for locked positions" in the contract specification is the clue.
What changes in practice:
- Free margin after locking. Under the first model it drops the moment the second leg opens, which can trigger a margin call on a nearly maxed account despite zero net risk.
- Stop out behavior. Some platforms close positions in a particular order, such as largest loss first, and that can break the lock and leave a naked leg at the worst possible moment.
- Cross-pair hedges. A long on one pair and a short on a correlated pair is not a lock in the margin engine's eyes, so no offset applies even if the exposure feels hedged.
- Account currency conversion. The reduction is calculated on the broker's side, so the displayed number can differ from a manual calculation.
The details sit in the contract specifications and the account terms, and they can differ between account types at the same broker. Opening a small locked pair and watching what happens to used margin is a cheap way to find out the real rule instead of trusting a summary page.
Which model has shown up on your account, and has the stop out order ever broken a lock on you?