Negative Balance Protection & Stop Out

Axiory’s way of Protecting Traders from Sudden Market Fluctuations

Trading Forex is attractive mostly because of the financial leverage. Leverage allows you to have more exposure in the market than you would with just your initial deposit. In Axiory, we value the safety of our customers, therefore, we have applied safety measures in the form of margin call, stop out, and most importantly negative balance protection.

Negative Balance Protection

Negative Balance Protection is Axiory’s answer to our customer’s concerns about losing more than they have invested. With this precautionary measure any losses that exceed your overall account balance will be automatically reset to zero. This means you will never lose more than you have deposited.

How Does the Margin Call and Stop Out Work

Both Margin call and Stopout are connected to the trader’s equity. Should a margin level on a trader’s Nano, Standard or MAX account fall below 50% the Margin call will prevent traders from opening new positions.

Stop Out comes into play when the margin level of your account falls below 20%. Stop Out is a process that aims to decrease the margin of your account by closing positions. Which positions are closed are chosen by the trading platforms server and how it’s been programed to work. Stop Out behaves differently in  trading platforms, and for sure, it works differently in MT4 and cTrader. Stop Out’s are never a good thing, but we should always be prepared for the worst. Have a look at how different platforms will start closing your positions.
 

MetaTrader 4 Stop Out

The Stop Out logic in MT4 will close the most unprofitable position first, and sequentially close other positions in order of which are losing the most. While this may seem logical, actually, closing the most unprofitable position might not do much in terms of restoring margin. However, it is an easy logic to understand.

cTrader Stop Out 

Smart Stop Out works by partially closing the position which is taking the most margin. This position will be partially closed in the smallest possible increment needed to restore your accounts margin level to above Stop Out Level. 

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