Stop Out

Stop Out is a term used to describe the margin level to maintain the current open position (Maintenance Margin) that is no longer sufficient. And will be forced to close the order by the broker immediately when the margin level reaches a certain number such as 20%, 30%, 50%. Stop Out level will vary, which will be more or less depending on with a broker.

The words “Stop Out” and “Stopped Out” have different meanings. In the forex market, the term Stop out means to automatically close the position immediately when a certain level is reached. This is done immediately by the broker regardless of whether the trader has set a stop loss or not.

But for other markets such as the stock market, Stopped Out means cutting losses by investors themselves. When the price reaches the specified price, the stop loss order will close the position as usual.