Trade Gold Trading

What Happens When Free Margin Hits Zero?

What Happens When Your Free Margin in Your Trading Account is Negative?

A gold margin call is when a trader's trading account free trading margin goes below the required gold margin level which's set by broker. This means because the free trading margin in the trader's account has dropped below the required gold margin level then the trader gets a trading margin call & some of the open trades in gold trader's are closed by broker until this gold margin level goes back upto above the required gold trading margin level.

Some of the open trades may be stopped out or all of the open trade positions may be stopped out if this gold trading margin call is automatically executed by broker.

What is Gold Margin Requirement Level?

Now if Your Leverage is 100:1

When trading if you have $1,000 dollars and use leverage of 100:1 & buy 1 standard lot for $100,000 your trading margin on this trade is the $1000 dollars in your account, this is the money that you will lose is your open trade moves against you and the other $99,000 which is borrowed, the broker will close out the open trades automatically using a Margin Call once your $1,000 has been taken by the trading market.

But this is if your online broker has set Zero percentage% Gold Margin Requirement before stopping out your trades automatically using this Gold Margin Call.

What is 20% XAUUSD Margin Requirement Level?

For 20% gold trading margin requirement before stopping out your trades automatically using what is known as a Margin Call, then your trades will be stopped out once your trading account balance reaches $200 - at $200 you will get a trading margin call.

What's 50 percentage% Margin Requirement Level?

For 50% prerequisite of this level before stopping out your trades automatically using what is known as a margin call, then your transactions will be closed once your account balance gets to $500 - at $500 you'll get a trading margin call.

What's 100 Percentage Margin Requirement Level?

If the broker sets 100 Percent margin requisite of this level before stopping out your open transactions automatically using a Margin Call - at $1,000 you'll get a margin call, then your trades will be closed once your trading account balance reaches $1,000: Meaning the trade transactions will close-out as soon as you execute a one standard lot on this trading account because even if you as a trader you pay $10 spread your trading account balance will get to below $1,000 dollars and the needed gold trading margin requirement percentage is 100 percentage i.e. $1,000, henceforth your orders will immediately get closed using a Margin Call once your trading margin requirement falls below 100 percent.

Most brokers don't set 100 Percent gold trading margin requirement, but there are those brokers that set 100 Percent margin are not suitable for you at all, even those who set 50 percent gold trading margin requirement are still not suitable. Choose those set 20% gold trading margin requirements, in fact, those brokers which set their margin requirement at 20% XAUUSD Margin Requirement are some of the best because the likelihood they close out your trade using a Margin Call is reduced as illustrated in the above example.

To Learn More about Leverage and XAUUSD Margin - Study the Learn Topics Below:

Leverage and XAUUSD Margin Described

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