When you hear the words “margin trading,” it might sound like something best left to financial pros in glass towers. But with the right tools, knowledge, and guardrails, margin trading can become a useful part of your investing strategy.
At Clarity, we believe in giving you access to more markets, more opportunity, and more control. That includes empowering you with options like margin trading, explained in a way that actually makes sense.
What Is Margin Trading?
Margin trading is when you borrow money from your trading platform to increase the size of your trade. It allows you to trade with more capital than you have in your account.
This borrowed capital is called leverage, and it can increase both your potential gains and your potential losses. That is why margin trading is best suited to confident, experienced traders who understand the risks and rewards.
Breaking Down the Jargon
Here’s what you need to know in plain English:
Margin: The amount of your own money you must put up to open a leveraged position. Think of it as your deposit.
Leverage: The ratio of how much you can trade relative to your margin. An 1 to 8 leverage means for every R1 you invest, you control R8 worth of the asset.
Initial margin requirement: The minimum amount you need in your account to open a margin trade.
Maintenance margin: The minimum amount of equity you must maintain to keep the trade open. If your account balance drops below this, you may receive a margin call.
Margin call: A request to deposit more funds or close positions to avoid automatic liquidation.
A Simple Example
Let’s say you have R10,000 in your Clarity margin account and you want to trade an asset that costs R80,000. (At Clarity you get up to 1 to 8 leverage. Leverage is dependent on instrument level.)
With 1 to 8 leverage, Clarity lets you open that R80,000 position using your R10,000 as margin. You are borrowing the remaining R70,000.
If the price of the asset goes up by 10 percent, your gain is R8,000. That is a return of 80 percent on your original R10,000.
But if the price drops by 10 percent, you lose R8,000. That leaves you with only R2,000 in your account.
Margin trading increases both the upside and the downside, which is why it should be used with caution and a clear strategy.
How Margin Works on Clarity
At Clarity, margin trading is available on both ZAR and USD accounts. Our goal is to make the experience powerful, but also transparent and fair.
Here’s what you can expect:
Clear fees: We charge a margin rate in addition to the standard spread when you use margin. No hidden costs.
Competitive rates: Our margin rates are structured to give you the ability to trade bigger without unreasonable borrowing costs.
Full visibility: We always show your margin usage, account balance, and margin call thresholds clearly in your dashboard.
Is Margin Trading Right for You?
Margin trading can offer exciting opportunities, but it is not for everyone. Here’s how to know if it fits your trading profile:
| Feature | Margin May Be Right For You If… |
|---|---|
| Experience level | You’ve traded before and understand market volatility |
| Risk tolerance | You’re comfortable with bigger swings in both directions |
| Trading style | You trade actively and monitor your portfolio regularly |
| Goals | You want to capitalise on short-term market movements |
| Mindset | You think in terms of risk management, not just return |
If you’re a long-term investor who prefers slow and steady growth, margin trading might not align with your style. And that is perfectly fine. Clarity is designed to support all kinds of investors, not just high-frequency traders.
Margin Trading at a Glance
✅ Trade with more buying power using Clarity’s ZAR or USD margin accounts
✅ Only available to verified, approved clients who meet margin criteria
✅ Margin rates are applied in addition to spread, and clearly displayed
✅ No hidden costs, no platform fees, no commissions
✅ Backed by Investec’s reliability and risk controls
