Collateral level, warning procedures and forced closing of positions

Collateral level, warning procedures and forced closing of positions

Collateral is a deposit that is blocked on the trader’s account for each transaction.


The greater the financial leverage, the less collateral will be, which will be frozen in the trader’s account.


Collateral level is the ratio of the trader’s capital and the collateral involved. The collateral level is displayed as a percentage. This indicator helps the trader understand whether he has enough funds to open new transactions or maintain already open orders.


It can be calculated using the formula:


Collateral level = Equity / Collateral involved * 100%

Equity = Balance ± Profit (Loss) on open transactions

Collateral level 
Account status
>100%Normal status
<=100%
Account is in warning status
<=50%
Forced termination of operations 



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