Margin refers to the minimum funds required to open or maintain a leveraged trading position in derivatives. In Futures and Options, exchanges define initial and maintenance margin requirements to ensure trade security. Initial margin is the upfront amount needed to enter a trade, while maintenance margin is the minimum balance to keep the position open. Margin acts as a security deposit to cover potential losses. Margins vary depending on volatility, asset class, and trader profile. Brokers may also impose additional margin known as VAR (Value at Risk) or ELM (Extreme Loss Margin). If a position moves against the trader, a margin call may be triggered requiring funds to be added. Insufficient margin leads to automatic position squaring-off. Understanding margin dynamics is vital to avoid forced liquidation and manage leverage. Tools like SPAN calculator help estimate margin requirements before taking a trade. Wise margin management protects from unnecessary losses and ensures trading discipline.