Using leverage means that you can trade positions larger than the amount of money in your trading account. Leverage amount is expressed as a ratio, for instance 50:1, 100:1, or 500:1. If you have $1,000 in your trading account and you trade ticket sizes of 500,000 USD/JPY, your leverage will equate 500:1.
TradeFills shall monitor the leverage ratio applied to clients’ accounts at all times and reserves the right to apply changes to and amend the leverage ratio (i.e. decrease the leverage ratio), on its sole discretion and without any notice on a case by case basis, and/or on all or any accounts of the client as deemed necessary by TradeFills. On the one hand, by using leverage, even from a relatively small initial investment you can make considerable profit. On the other hand, your losses can also become drastic if you fail to apply proper risk management.
Although each client is fully responsible for monitoring their trading account activity, TradeFills follows a margin call policy to guarantee that your maximum possible risk does not exceed your account equity.
As soon as your account equity drops below 50% of the margin needed to maintain your open positions, we will attempt to notify you with a margin call warning you that you do not have sufficient equity to support open positions.
The stop-out level refers to the equity level at which your open positions get automatically closed. The stop-out level in a client’s account is reached when the equity in the trading account is equal or falls below 25% of the required margin.