📖 Financial Lexicon Term
What is Stop Out?
The automatic closure of a trader's open positions by the broker when the margin level falls to a critically low threshold.
Detailed Explanation
If a Margin Call is ignored and the market continues against you, the Stop Out level is reached (typically between 20% to 50% Margin Level). The broker's risk system will automatically liquidate your largest losing positions to prevent your account balance from dropping below zero.
💡 Practical Trading Example
With a 50% stop-out level, if your required margin is $1,000, the broker will start liquidating your trades the moment your account equity drops to $500.