What is stop-out and how is it calculated?
A stop-out occurs when the margin level in your trading account falls below a specified threshold, triggering the automatic closure of your open positions. This is a risk management measure designed to prevent negative balances and ensure that you maintain sufficient margin to support your trades.
Vantage's margin stop-out level on all trading platforms is set at 50% for retail clients, in compliance with FCA regulations. This means that if your account's margin level drops to or below 50% of the required margin, the system will begin to automatically close your open positions, starting with the one that has the largest loss.
Calculate your margin level:
Margin level = equity/used margin × 100%
DISCLAIMER:
While a stop-out is designed to limit losses, it does not guarantee that you will not lose more than your initial investment. Market conditions can change rapidly, and you may still incur losses.