Trade Gold Trading

Margin Call Definition

A margin call hits when free margin falls below the broker's required level for gold trades. The broker then closes some positions to raise the margin back up. This stops further losses on the account.

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

What is XAUUSD Gold Margin Requirements Level?

Now if Your Leverage is 100:1

When you trade, if you have $1,000 and use a leverage ratio of 100:1 and purchase 1 standard lot/contract for $100,000 dollars, your margin on this trade is the $1000 that is in your xauusd account, and this is the amount you will forfeit if your open trade transaction goes in the wrong direction for you - regarding the other $99,000 that has been borrowed, the broker will automatically close the open trade transactions by using a Trading Margin Call after your $1,000 is depleted by the market.

But this happens if your broker has set the XAUUSD Gold Margin Requirements to zero before it automatically closes your trades because of a Margin Call.

What's 20 % Margin Requirements Level?

Given a 20% margin requirement before your trade positions are automatically liquidated via a Margin Call, your trades will be stopped out immediately once your account balance reaches $200 - the margin call notification occurs precisely at the $200 mark.

What is 50 % Margin Requirements Level?

If you need 50 percent of this amount before your trades are automatically closed because of what is known as a margin call, then your trades will close when your account has $500 - you'll get a margin call at $500.

What is 100 % Margin Requirements Level?

If the broker sets 100 Percent trading margin percent level requirement of this level before mechanically/automatically closing your open positions using a margin Call - at $1,000 you will get and receive a margin call, then your gold trade positions will be closed once your account balance gets to $1,000: Explanation the trade positions will liquidate as soon as you as a trader executes a 1 standard contract on this account because even if you as a trader you pay $10 dollars spread your account balance will get to below $1,000 & the needed margin requirement percent is 100 % i.e. $1,000, therefore your open positions will immediately get liquidated using a Margin Call once your trading margin requirement falls below 100%.

Most brokers do not set 100 Percent margin requirement, but there are those online brokers that set their margin requirement level at 100 percent margin aren't suitable for you as a trader at all, even those who set 50 % margin requirement level still aren't suitable. Select those gold brokers that set their margin level requirement at 20 % margin level, in fact, those gold brokers that set their margin requirement at 20% XAUUSD Gold Margin Requirement are among some of the best because the likely hood that they close-out your trade position using a Margin Call is reduced and minimized like shown in the illustration above.

To Learn More about Leverage and Margin - Learn the Lessons Below:

Leverage & Margin Lesson

Study More Topics and Tutorials:

Gold Broker