Education - Closing positions

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	Closing positions using 50% margin level technique

	What is the margin level (ML)?

	It is the percentage of the net equity to the required margin. In other words, it refers to how many times the equity can cover the required margin.

	How to calculate the margin level (ML)?

	Margin level is automatically calculated through the trading system as follows:



	It is also possible to do it manually by dividing the equity with the required margin:
	ML = Equity ÷ Margin

	To calculate (ML) in the previous example:
	ML = 17790.18 ÷ 14500
	ML = 1.2269

	To get the result as a percentage
	ML = 1.2269 x 100
	ML = 122.7 %

	Warning and When It Appears

	Warning (as you can see in the table) appears in the account when the Margin Level drops below 100%, which means that the account's equity can not cover the required margin.



	When will the open positions be closed?

	The trading system will automatically start closing the open positions when the Margin Level drops below 50% as in the table below:



	Will the system close all open positions at a 50 % margin level?

	Yes, in case the ML drops below 50%, the trading system will automatically close all open position.

	Is it possible that the equity can drop below zero?

	Yes, equity may go down below the zero level $0.00. In this case, the CFSA trading system will automatically close all open positions, even if the account was fully hedged. The client will not be responsible for the deficit in the account and it will be covered up to the zero level.