Trading and risk
Leverage, margin call and stop-out: how you can lose your whole deposit in a day
Calculations for a USD 1,000 deposit from 1:2 to 1:500 leverage, when a stop-out hits, ESMA limits, gaps and negative balance protection.
Margin call: what it means
A margin call is a broker warning that your account no longer holds enough funds to support open leveraged positions.
A margin call is a broker's signal that the margin level in your account has fallen below a set threshold. The margin level is your funds, including the current loss, divided by the margin blocked for open positions.
After a margin call, the broker asks you to top up the account or close some positions. If the price keeps moving against you, the next step is a stop-out: positions are closed by force.
Each broker sets its own margin call threshold, so check it in your contract.
In detail, with examples: Leverage, margin call and stop-out: how you can lose your whole deposit in a day
Related terms
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