Trading glossaryReviewed 16 July 2026
Definition
Notional value is the reference amount of an instrument or underlying exposure used to calculate a leveraged position’s gains, losses, and obligations.
In market context
It can equal units multiplied by reference price even when the trader posts only a smaller margin amount. Fees, financing, and risk limits may be based on notional rather than cash invested, making it central to understanding leverage. Notional is not necessarily the amount exchanged at settlement, but adverse movement on that larger reference exposure can materially affect account equity.
Source
Use the primary source for fuller regulatory or market context.