What margin does
Margin is money or other eligible collateral required under an account or product's rules. It supports obligations associated with a position, but it is not necessarily the purchase price or the maximum possible loss. Initial and ongoing requirements can serve different purposes. The relevant definitions depend on whether the arrangement involves securities borrowing, futures or another leveraged product, so identify the structure before applying a rule learned from a different market.
How pressure develops
If a position moves adversely, account equity can fall while the required collateral remains substantial or increases. The account may then breach a maintenance requirement or a provider's close-out threshold. A request for additional collateral and a forced closure are different possible events governed by the agreement. Do not assume there will always be enough time to add funds or that the provider must wait for a personal response before acting.
Prepare for more than the entry
Calculate the full exposure and consider a larger adverse move, financing costs and the effect of several positions losing together. Keep funds needed for essential expenses separate from a speculative risk budget. Read the provider's liquidation rights and any applicable protections. FYLU has not established live margin ratios, warnings or close-out procedures; its preview does not provide collateral management or guarantee that a hypothetical loss will be limited to an initial deposit.