What margin level triggers a stop-out?

It is set by the broker and stated per account type, commonly between 20% and 50%. The margin call warning usually sits at 100%. Both numbers should be read before funding, because at identical position sizes a 50% stop-out closes an account substantially earlier than a 20% one.

Can an EA prevent a margin call?

Only in advance, by trading small enough that the margin level never approaches the stop-out. The closure itself happens at the broker's server and can occur between ticks, so no EA logic runs at that moment. Everything that protects the account has to have happened at position sizing.

Does a stop-out mean I lost everything?

Not necessarily. The broker closes positions until the margin level is back above the stop-out, so some equity usually remains — often a fifth to a half of the used margin. What is lost is the choice of when to exit, which is why the realised loss is normally worse than the strategy's own exit would have taken.

Can I end up owing money?

Only without negative balance protection. Under a gap large enough to pass through the stop-out before anything can be closed, the account can in principle go below zero, and negative balance protection is the policy that writes that difference off. Every broker listed in this catalogue provides it, but it is worth confirming on the specific entity that holds the account.

Category: Risk
Difficulty: Beginner
Used in: Risk managementBroker selectionMT5 operation

Margin call

A broker warning issued when the margin level of an account falls to a stated percentage, followed by automatic closure of positions at a lower percentage called the stop-out.

also: margin closeout, stop out, margin level warning

Updated 2026-08-16 · Reviewed2026-08-16

In plain English

The broker watches how much equity is left against the margin your open positions require. When that ratio drops far enough it warns you, and if it keeps dropping it closes positions for you — at the worst possible moment, because that is what caused it.

Why it matters

A margin call is the point at which the broker, rather than the strategy, decides which trades close. Every rule the EA follows about exits stops applying, and the loss taken is whatever the market happens to be offering at the time.

It converts a temporary drawdown into a realised one. Positions that would have recovered are closed at the bottom of the move.
It is triggered by the margin level, a ratio of equity to used margin — so it depends as much on how much margin is locked up as on how far the market has moved.
It usually arrives during exactly the events an EA is least prepared for: gaps, releases, weekend reopens.
It is fully predictable in advance. Equity, used margin and the broker's stop-out percentage are all known before a trade is opened.

How brokers define it

Margin level is equity divided by used margin, expressed as a percentage. MT5 shows it live in the Toolbox under Trade.
The margin call level is the percentage at which the broker warns and usually blocks new positions — commonly 100%, meaning equity has fallen to the margin the open positions require.
The stop-out level is the lower percentage at which the broker starts closing positions automatically, commonly between 20% and 50%.
Closure is normally largest-loss-first and continues position by position until the margin level is back above the stop-out.
Neither level is a courtesy: closure is automatic and needs no contact with the client, so the warning is not something an EA can rely on acting upon.

What differs between brokers

The two percentages themselves. A 50% stop-out closes an account far earlier than a 20% one at identical position sizes.
Whether the levels differ by account type, symbol group or exposure tier.
The closure order — largest loss first is usual, but not universal.
Whether leverage is reduced around weekends and releases, which raises used margin and lowers the margin level without any market movement.
Whether hedged positions receive margin relief, which changes the calculation for strategies that hold both directions.

Impact on EA performance

An EA has no way to prevent a stop-out. Closure happens at the server, outside the EA's control, and can fire between ticks.
The EA's own stop-losses become irrelevant once the stop-out engages, because the broker closes on margin level rather than on price levels.
Strategies holding multiple positions accumulate used margin as they add legs, so margin level falls from two directions at once — rising margin and falling equity.
The Strategy Tester models margin and does trigger a stop-out, but only against the tester's leverage and stop-out defaults, which frequently differ from the live account.
A backtest that survived a drawdown does not prove the live account survives it; the same equity curve on a smaller balance or a lower stop-out level ends at the stop-out instead.

What to confirm before funding

The margin call percentage and the stop-out percentage, as separate numbers, for the account type being funded.
Whether hedged positions get margin relief, if the strategy holds opposing positions.
Whether leverage — and therefore used margin — is changed around weekends or news.
The order in which positions are closed at stop-out.
That the account is covered by negative balance protection, which is what stands between a gap through the stop-out and a debt.

Typical risks

Sizing from the historical maximum drawdown without leaving a buffer, so the first drawdown slightly worse than the record ends the account.
A grid or basket adding positions into a losing move, raising used margin exactly while equity falls.
Weekend gaps opening past the stop-out level, so closure happens at the gap price and no stop-loss ever traded.
Assuming the margin call warning gives time to act — with an EA running unattended, it does not.

Example

A $5,000 account running an EA at full size through a drawdown equal to its historical maximum. The margin level is what decides whether the drawdown is survived or realised.

Balance at start: $5,000
Used margin, 3 open positions: $1,000; At 1:500 on major pairs, three positions of moderate size.
Equity at the trough of a 20% drawdown: $4,000; Margin level 400%. Comfortable.
The same drawdown at 5× the position size: equity $0 before stop-out; Used margin $5,000, and a 20% drawdown takes the margin level to 80% — below the stop-out on most accounts.

Nothing about the EA changed between these two rows. The drawdown percentage was identical; only the margin left standing under it differed.

Calculation 4,000 ÷ 1,000 = 400% · 4,000 ÷ 5,000 = 80%

Result The same strategy and the same market, decided entirely by size

How it is used

Margin level is the number to watch, not the balance. Read it against the broker's stop-out percentage before the drawdown rather than during it.

Range	What it means
Margin level above 500%	A drawdown several times the historical maximum still leaves the account intact.
300–500%	Adequate for a single-position strategy with a known drawdown record.
150–300%	A drawdown modestly worse than the record reaches the stop-out. Reduce size.
Under 150%	Ordinary market movement can close the account. The broker is now managing the positions.

Compute the margin level at the strategy's worst historical drawdown before funding, not after deploying.
Leave a buffer of at least half again on top of the recorded maximum drawdown — the record is the worst seen, not the worst possible.
Count used margin at the maximum number of simultaneous positions the EA can hold, not the average.
Read the stop-out percentage as part of the account cost. A 50% stop-out and a 20% stop-out are materially different products.
Check the margin level after any broker leverage reduction, because used margin can rise while the market is closed.

Every EA listed here publishes its maximum drawdown from the same audited run, so the margin arithmetic can be done against a stated figure before any money is committed.

Common mistakes

Confusing the margin call with the stop-out

The margin call is a warning and normally blocks new positions; the stop-out is the automatic closure. For an EA running unattended only the stop-out percentage matters, because nobody is present to act on the warning and the EA cannot prevent the closure.

Sizing to exactly the historical maximum drawdown

The recorded maximum is the deepest trough in the sample, and the next sample will contain a deeper one eventually. Sizing so that the historical maximum lands precisely at the stop-out level guarantees the account ends on the first ordinary excursion beyond the record.

Assuming stop-losses protect against a stop-out

They protect against price moving through a level. A stop-out is triggered by the margin level, and in a gap the account can pass through both the stop-loss and the stop-out before any order trades. Only position size and free margin protect against that.

Forgetting that used margin can rise on its own

Brokers routinely reduce leverage before weekends and major releases. Used margin rises, the margin level falls, and an account that looked safe on Friday afternoon can be near its stop-out on Sunday reopen without the market having moved at all.

In depth

Running the margin arithmetic on our own fourteen records

Across the 14 EAs published here	Figure
Records containing a margin call or stop-out	0
Starting balance on every run	$10,000
Lot size on every leg	0.10, fixed
Deepest equity drawdown of any record	$3,238.83 (25.62%)
Median equity drawdown across the fourteen	$950.50
Lowest point equity reached on any record	$6,761 of the $10,000

The worst trough belongs to Cairn, the portfolio record: $3,238.83 of open drawdown against the $10,000 deposit. Even there, equity never went below $6,761 — and a single 0.10-lot position at the granted 1:100 leverage locks up only around a hundred dollars of margin, which puts the margin level in the thousands of percent for every single-position record in the catalogue for the entire test.

The stress case is Cairn with all two dozen legs open at once: roughly $2,500 of used margin at today’s rates. Divide the worst-trough equity by that and the margin level still sits near 270% — five times above a 50% stop-out, thirteen times above a 20% one. That is the honest reading of the table above: these records never came near the margin mechanics, so they say nothing about how the strategies behave when a broker starts closing legs. A record with no margin call in it is not a record that passed the test; it is a record that never sat the exam.

What the drawdown figures are good for is the reverse calculation. Take Cairn’s worst equity trough, add the equity floor a 50% stop-out demands on $2,500 of used margin, and the minimum account that survives the recorded history is roughly $4,500 — under half the deposit the test actually ran on. Fund the same strategy with $3,000 because “the backtest never had a margin call”, and the recorded history itself would have ended the account. The published number that matters is equity_drawdown_abs, not the absence of margin events.

Frequently asked questions

What margin level triggers a stop-out?: It is set by the broker and stated per account type, commonly between 20% and 50%. The margin call warning usually sits at 100%. Both numbers should be read before funding, because at identical position sizes a 50% stop-out closes an account substantially earlier than a 20% one.
Can an EA prevent a margin call?: Only in advance, by trading small enough that the margin level never approaches the stop-out. The closure itself happens at the broker's server and can occur between ticks, so no EA logic runs at that moment. Everything that protects the account has to have happened at position sizing.
Does a stop-out mean I lost everything?: Not necessarily. The broker closes positions until the margin level is back above the stop-out, so some equity usually remains — often a fifth to a half of the used margin. What is lost is the choice of when to exit, which is why the realised loss is normally worse than the strategy's own exit would have taken.
Can I end up owing money?: Only without negative balance protection. Under a gap large enough to pass through the stop-out before anything can be closed, the account can in principle go below zero, and negative balance protection is the policy that writes that difference off. Every broker listed in this catalogue provides it, but it is worth confirming on the specific entity that holds the account.

Related resources

Tool Margin & Stop-Out Compute used margin and the resulting margin level before the position is open. Guide Testing Methodology How the drawdown figures used in this arithmetic are produced and audited. EAs Browse EAs by historical drawdown The shallower the drawdown, the further the account stays from any margin event.