Margin level is a financial ratio that measures the equity in a trading account relative to the margin used for open positions, typically expressed as a percentage. It is calculated using the formula: (Equity / Used Margin) x 100. A higher margin level indicates a healthy account with ample equity to cover potential losses, while a lower margin level can signal higher risk and may trigger margin calls, where the broker requires additional funds or the closing of positions to maintain the required margin. Traders often monitor margin levels closely to manage their risk effectively.