A margin call is a warning sent when a client's margin level (equity divided by used margin) falls to a set percentage, for example 100%. The stop out level is a lower percentage, for example 50%, at which the platform automatically starts closing positions to stop further losses. Negative balance protection ensures a client's account cannot go below zero, so clients cannot lose more than they deposited. Brokers configure these levels by client group in MT5, within the limits set by their regulator.
- Margin level = equity / used margin x 100%.
- A margin call is a warning; a stop out automatically closes positions.
- Brokers set margin call and stop out levels per client group in MT5.
- Negative balance protection stops client accounts from going below zero.
- Regulators in many jurisdictions set minimum stop out levels and require negative balance protection for retail clients.
Looking for broker risk management tools? Margin settings, dynamic leverage and negative balance tools for MT5.
Margin settings protect clients from losses larger than their deposit and protect the broker from unpaid negative balances. Getting them right is a core part of broker risk management.
How margin level works
Margin level = equity ÷ used margin × 100%. For example, a client with USD 1,000 equity and USD 500 used margin has a margin level of 200%. As losses reduce equity, the margin level falls.
Margin call vs stop out
| Margin call | Stop out | |
|---|---|---|
| What happens | Warning to the client | Positions closed automatically, usually largest loss first |
| Example level | 100% | 50% |
| Purpose | Give the client time to add funds or reduce positions | Stop further losses |
The example levels are illustrations; your regulator may set minimums for retail clients.
Negative balance protection
In fast markets, prices can gap past the stop out level and leave an account below zero. With negative balance protection, the broker resets the balance to zero, so the client never owes more than they deposited. Many regulators require it for retail clients, and it is a strong trust signal.
How brokers configure these settings
- Margin call and stop out levels are set per client group in the MT5 manager.
- Dynamic leverage lowers leverage on large positions and around news and weekends, reducing gap risk.
- Negative balances can be reset automatically by a plugin or handled through the CRM.
General information only, not legal, financial or tax advice. Each client is responsible for its licences and the laws of every country where it operates.