What is the Margin Call Level and how is it calculated?
The Margin Call Level is a threshold set to alert traders that their account equity has fallen to a critical level at 50%, exposing them to a margin call.
The formula to calculate Margin Level is:
Margin Level= (Equity/Used Margin)*100%
*Note:
1. A margin call is a demand to deposit more funds or close your opening positions to ensure that the account equity does not fall below the required margin to prevent your account from stop out liquidation.
2. Equity is the total funds of the trading account after including profits and losses from open positions.
3. Used Margin represents the amount of funds that are currently tied up as collateral for maintaining open positions.