What is Margin, how does it work?

Initial margin is the deposit required to maintain either a short or long position in a futures contract, it is NOT a cost. The maintenance margin is the amount of initial margin that must be maintained for that position before a margin call is generated. The maintenance margin level is NOT additional to the initial margin.

For example if the initial margin for silver is $1,000 and the maintenance margin level is $750, one would need to have $1,000 allocated from their account as initial margin to trade a silver contract, and if the silver position lost let's say $300 one day, the value of the $1,000 initial margin would now only be $700, which is below the $750 maintenance requirement. Therefore, excess funds in the amount of $300 from the account would be automatically allocated towards bringing the initial margin figure back to $1,000. If there were not excess funds in the account to automatically bring the initial amount back up to $1,000, that position would create a margin call situation and that margin call would have to be either immediately met with additional funds or the position would be liquidated.

Mini-Contract Margins: Range from 1/2 to 1/5th of the Full-sized contracts. For instance currencies, financials, and the meats typically require margins that are 1/2 of the Full-sized contract. Stock indices, grains, and silver margins are typically 1/5 of the Full-sized contracts, gold is 1/3. Ask your broker for details.