In Forex trading, a Stop Out Level is when your Margin Level falls to a specific percentage (%) level in which one or all of your open positions are closed automatically (liquidated) by your broker. This liquidation happens because your trading account can no longer support the open positions due to a lack of margin. More specifically, the Stop Out Level is when the Equity is lower than a specific percentage of your Used Margin. If this level is reached, OXShare will automatically start closing out your trades starting with the most unprofitable one until your Margin Level is back above the Stop Out Level.
Example: Stop Out Level at 40%
This means that your trading platform will automatically close your position if your Margin Level reaches 40%.
Suppose you bought EURUSD, and the market started falling against you.
Used Margin: $200
Equity = Balance + Floating P/L
When your equity is equal to $80 (40% stopout multiplied by the used margin), then your stopout will be triggered and your position will be closed out.
Depending on the type of account you open at OXShare, you can choose leverage on a scale from 1:00 to 1:1000. In OXShare you have the option to request an increase or decrease of the leverage you have chosen yourself from 1.100 up to 1.1000.
On the one hand, by using leverage, even from a relatively small initial investment, you can make a significant profit. On the other hand, your losses can also become huge if you fail to apply proper risk management.
That's why OXShare provides a leverage range that helps you choose your preferred risk level. At the same time, we do not recommend trading with leverage due to the high risks involved, up to the loss of your entire account.
Each client bears full responsibility for monitoring the activity of his or her trading account, however OXShare follows a margin call policy to ensure that the maximum potential risk does not exceed your account balance.
Once your account balance drops below 100% of the margin required to maintain your open positions, OXShare will flash your account red and notify you via a margin call to warn you that you do not have enough equity to support your open positions.
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