A stop-out is the automatic closure of positions by the broker when the margin level falls to a preset percentage, for example fifty percent. The broker chooses which positions to close, usually beginning with the largest loser, and it does so to prevent the account equity going below the margin already in use. A stop-out is a consequence of oversized positions or missing stop-losses rather than a risk-control tool you plan around.
Forex glossary
Stop-Out
Related term
Margin
Margin is the portion of your balance that the broker sets aside as a deposit while a leveraged position is open. It is not a fee and not a minimum account size…
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