A stop out occurs when the market moves unfavorably against your positions, causing your account equity to fall below a certain threshold. In such cases, the system will automatically close positions to prevent further losses.
Key Points:
- You are responsible for any losses incurred from the forced liquidation.
- You can avoid stop out by:
- Partially closing positions
- Adding funds promptly to your account
- Ohio Markets’ stop out level is 20% of the required margin.
Example:
If your account equity falls to 20% or below of the required margin:
- The system will automatically close the position with the highest loss first.
- Positions will continue to be closed until your margin level rises above 20%.
Stop out is a risk management mechanism to protect both your account and the broker from excessive losses.