Help CenterIn trading, margin calls and stop-out levels are crucial to understanding how your trades are managed, especially during periods of high market volatility. Here's a breakdown of these key concepts:
1. 100% Margin Call
A 100% Margin Call occurs when the equity in your account falls to the point where it matches the margin used for your open positions. At this stage:
- Trading Restrictions: You will not be able to open any new trades.
- Immediate Action Required: You must either deposit additional funds into your account or close some positions to bring your margin level back to a safer range.
2. 70% Stop-Out Level
The 70% Stop-Out Level is a critical threshold where:
- Automatic Closures: Your open trades will start closing automatically to prevent further losses. This mechanism is in place to protect your account from going into negative equity.
- Margin Restoration: The automatic closures aim to restore your Margin Level to a more sustainable level.
Calculating Your Margin Level
To monitor your margin health, use the following formula to calculate your Margin Level
Margin Level = (Equity / Margin) * 100
Where:
- Equity is the total value of your account.
- Margin is the amount of money required to maintain your open positions.
How to Maintain Healthy Margin Levels
To avoid reaching the margin call or stop-out levels:
- Increase Equity: Deposit additional funds into your trading account to improve your margin level.
- Reduce Margin Usage: Lower the lot size of your positions to decrease the margin required, thus improving your margin level.