The Margin Stop Out level is the point at which one or more open positions may be closed automatically/liquidated because the account no longer has sufficient Equity relative to the Margin required to maintain those positions.
ThinkMarkets' standard Margin Stop Out level is 50%.
Margin Level is calculated as:
Margin Level = (Equity ÷ Used Margin) × 100
Example
Assume:
- Account Balance: USD 1,000
- Running loss: USD 750
- Account Equity: USD 250
- Used Margin: USD 500
The Margin Level would be:
(250 ÷ 500) × 100 = 50%
At this point, the account has reached the standard Margin Stop Out threshold and open positions may be closed automatically.
How positions are liquidated may differ depending on the trading platform.
Fully hedged accounts may also be subject to different liquidation conditions.
Margin Stop Outs occur automatically when the applicable conditions are met. You should therefore monitor your Equity and Margin Level rather than relying on receiving a warning before positions are closed.
You can monitor your Margin Level directly through your trading platform.