Basic question

[FXnoob]

If i have $100 usd in my account and start trading and losing money, can i be in debt say like $1000 usd?

Or i just losing money in my account and cannot trade anymore?

tq

[FibMaster]

In general, your broker will protect his own bank account.

If your trading account goes negative, your broker would be at risk!

Check with your broker, the documents to open an account will explain the funding requirements and margin requirements.

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	Margin The deposit required to open or maintain a position. Margin can be either "free" or "used". Used margin is that amount which is being used to maintain an open position, whereas free margin is the amount available to open new positions. With a $1,000 margin balance in your account and a 1% margin requirement to open a position, you can buy or sell a position worth up to a notional $100,000. This allows a trader to leverage his account by up to 100 times or a leverage ratio of 100:1. If a trader's account falls below the minimum amount required to maintain an open position, he will receive a "margin call" requiring him to either add more money into his or her account or to close the open position. Most brokers will automatically close a trade when the margin balance falls below the amount required to keep it open. The amount required to maintain an open position is dependent on the broker and could be 50% of the original margin required to open the trade.

[DrForex]

Originally Posted by FXnoob

If i have $100 usd in my account and start trading and losing money, can i be in debt say like $1000 usd?

Or i just losing money in my account and cannot trade anymore?

tq

FXnoob
If you trade like a crazy person it would be possible but highly unlikely that you owe 10 times your capital.
In practice, if you trade like a mad man you might have a 10,000 position for your $100 and the value of 1 pip will be $1.00 (about, depending on the currency). That means you have margin for a 100 pip move against you before you begin to owe the broker money.
Their margin call will save you and them from that problem close to ZERO.
But there is the highly improbable circumstance where you really rush to ZERO due to a very big market move and the margin call, which is just the opposite position of what you have, i.e a sell if you have a buy, has big slippage (due to the fast moving market). For this slippage to be so much that you lose $1,000 it will probably have to be like an attack by the Klingons on the country of which you hold the currency (Bought, say USD).
In all my time in this market which include watching the demolition of the twin towers on 9/11 and the currency market, last years crazy moves and few others like BOJ intervention, if you stick to the major currencies, it is unlikely that any event will cause slippage beyond 100 points in a few seconds.
But, as i said, if you do crazy things in your account, crazy things can happen to you because you don't control the market.
Godspeed
DdT

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	Margin The deposit required to open or maintain a position. Margin can be either "free" or "used". Used margin is that amount which is being used to maintain an open position, whereas free margin is the amount available to open new positions. With a $1,000 margin balance in your account and a 1% margin requirement to open a position, you can buy or sell a position worth up to a notional $100,000. This allows a trader to leverage his account by up to 100 times or a leverage ratio of 100:1. If a trader's account falls below the minimum amount required to maintain an open position, he will receive a "margin call" requiring him to either add more money into his or her account or to close the open position. Most brokers will automatically close a trade when the margin balance falls below the amount required to keep it open. The amount required to maintain an open position is dependent on the broker and could be 50% of the original margin required to open the trade.

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[gofx]

Interesting question, I just registered in this forum and started to learn some forex things.

Thank you.

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[traderkenny]

Originally Posted by FXnoob

If i have $100 usd in my account and start trading and losing money, can i be in debt say like $1000 usd?

Or i just losing money in my account and cannot trade anymore?

tq

I think the number not reach to $1000. in the case you lose, you may lose all $100, and then your account will be closed!

[johnnylu]

Hi everyone,
i just register in the forum and would like some help. I am thinking of starting forex trading and register for a demo account but i can't seem to get the parameters for the buy and sell amount.

I was told that when the market start going up that's when you get in which is what i try to do and then i can decide when i want to get out. But every time i try to start my trading i keep getting an error message stating invalid SL / TP. Your help is greatly appreciated.Thanks in advance.

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[DrForex]

Originally Posted by johnnylu

Hi everyone,
i just register in the forum and would like some help. I am thinking of starting forex trading and register for a demo account but i can't seem to get the parameters for the buy and sell amount.

I was told that when the market start going up that's when you get in which is what i try to do and then i can decide when i want to get out. But every time i try to start my trading i keep getting an error message stating invalid SL / TP. Your help is greatly appreciated.Thanks in advance.

You give very little information but it sounds like you are making use of entry orders and you might have the side of the take profit and stop loss all mixed up.

Just consult the online help of whatever platform you use.

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[japankk]

Originally Posted by FXnoob

If i have $100 usd in my account and start trading and losing money, can i be in debt say like $1000 usd?

Or i just losing money in my account and cannot trade anymore?

tq

nope i dont think any broker ever lets you dip below your actual account balance before margin calling your account. ask your broker the maintenance requiremnt some will margin call you at 50% account balance some 10% some until your entire balance is gone.

cheers

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	Margin The deposit required to open or maintain a position. Margin can be either "free" or "used". Used margin is that amount which is being used to maintain an open position, whereas free margin is the amount available to open new positions. With a $1,000 margin balance in your account and a 1% margin requirement to open a position, you can buy or sell a position worth up to a notional $100,000. This allows a trader to leverage his account by up to 100 times or a leverage ratio of 100:1. If a trader's account falls below the minimum amount required to maintain an open position, he will receive a "margin call" requiring him to either add more money into his or her account or to close the open position. Most brokers will automatically close a trade when the margin balance falls below the amount required to keep it open. The amount required to maintain an open position is dependent on the broker and could be 50% of the original margin required to open the trade.

[FXGroundworks]

A broker will never let you “owe” money. They will liquidate the account before they would let that happen.

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