Trade Gold Trading

XAU/USD Margin Call

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

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

Some of the open trade transactions might be closed or all of the open trade transactions might be closed out if this gold margin call is automatically executed by the online broker.

What's Gold Margin Requirement Level?

Now if Your Leverage is 100:1

When trading if you as a trader have $1,000 dollars & use leverage ratio of 100:1 and buy a trade position - your margin on this gold trade is the $$1000 in your account, this is the money that you will lose out if your open position goes against you & the other $99,000 which is borrowed, the online broker will closeout the open trade transactions mechanically using a Margin Call once your $1,000 has been taken by the market.

But this is if your online broker has set 0% Gold Margin Requirement before closing out your trades mechanically using this XAUUSD Margin Call.

What is 20% Gold Margin Requirement Level?

For 20% gold margin requirement before closing out your trades mechanically using what is known as a Margin Call, then your trade positions will be closed once your account balance drops to $200- at $200 you'll get a margin call.

What's 50 % Margin Requirement Level?

For 50% requisite of this level before stopping outstopping outliquidating your trades mechanically using a trade position margin call, then your trade positions will be stopped out once your trading account balance drops to $500 - at $500 you will get a margin call.

What's 100 % Margin Requirement Level?

If the online broker sets 100 % margin requirement of this level before liquidating your open trade positions mechanically/automatically using a Margin Call - at $1,000 you'll get a margin call, then your trade positions will be closed once your account balance drops to $1,000 dollars: Meaning the trade transactions will closeout as soon as you execute a 1 standard gold lot on this account because even if you as a trader you pay $10 spread your trading account balance will get to $990 & the needed gold margin requirement percentage is 100 Percent that is $1,000, thence your open trade positions will immediately get liquidated using a Margin Call once your trading margin requirement falls below 100 percent.

Most brokers do not set 100 % margin requirement, but there are those online brokers that set 100 % margin are not appropriate for you at all, even those who set 50 percent margin requirement are still not suitable. Select those set 20% gold margin requirements, in fact, those brokers that set their margin requirement at 20% XAUUSD Gold Margin Requirement are among some of the best since because of the likely hood they stop out-out your trade using a Margin Call is reduced and minimized as pictured in the above example illustration.

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Leverage & XAUUSD Gold Margin Explained

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