Margin is still not a cost - but capital has a price

Two tracks kept margin out of the cost column, and the third holds the line: nothing is charged, nothing is spent. What this lesson adds is the honest completion - the account behind the margin has a cost, and pretending otherwise flatters futures against alternatives.

The clean ledger, third telling

• Initial margin: a performance bond, returned at close - not in the cost column, ever.
• Variation margin: settled truth moving both directions - P&L realised nightly, not an expense.
• The account's capital: initial margin plus the headroom lesson 4 sizes - real money, parked, and the parking has a price: whatever that capital would otherwise earn.

Pricing the parking honestly

The opportunity cost is small and real: capital supporting a futures position earns nothing by default - though much of it can be held in interest-bearing form at many brokers, which shrinks the line toward the gap between rates earned and rates available elsewhere. The honest comparison with other wrappers therefore runs: futures tie up margin-plus-headroom at near-cash returns and charge no holding fee; CFDs tie up less and meter nightly; cash ownership ties up everything and meters nothing. Three capital structures, one comparison unit - total cost of the position over its holding period, capital's price included - and module 6 will insist the backtest uses it.

Why the distinction still matters

Because the two errors it prevents pull opposite ways. Calling margin a cost makes futures look expensive and drives traders toward wrappers whose real meters run higher - the old error, twice corrected. Calling capital free makes futures look costless to hold and hides the one line long-horizon comparisons need - the new error, corrected here. The ledger with three clean lines - deposit, settlement flow, capital's price - survives both, and it is the ledger every later cost comparison in this track uses.