Definition of Stop Out
The level at which a broker automatically closes your positions because your margin level has fallen too low (typically 20–50% margin level). Stop out protects both you and the broker from negative balances.
At a glance
Term
Stop Out
URL slug
stop-out
Category
Risk & capital
Short answer
The level at which a broker automatically closes your positions because your margin level has fallen too low (typically 20–50% margin level).
Deep dives
/blog/how-to-set-stop-loss-take-profit-forex/, /tools/lot-calculator/, /guide/risk-management/
Example
Example: $1,000 equity and 1% risk = a $10 cash cap. Size from “Stop Out” and stop distance, not from a gut-feel lot size.
Common mistake
Common mistake: confusing “Stop Out” with advertised max leverage — leverage alone does not set risk per trade.
Professional tip
Tip: write a cash daily loss limit independent of “Stop Out”, then let the definition set size only inside that ceiling.
Related deep dives
Practice tools:
Related terms
FAQ
The level at which a broker automatically closes your positions because your margin level has fallen too low (typically 20–50% margin level).
“Stop Out” sits inside capital protection. Ignoring it turns leverage and margin from tools into a path to rapid loss.
Common mistake: confusing “Stop Out” with advertised max leverage — leverage alone does not set risk per trade.