LEARN FOREX Introduction To Forex Lesson 9: Risks and Margin Calls
You should be aware that it is possible to loose money if you aren't careful. In case that money in your account fall bellow available amount (Margin Call), your FOREX broker has a right to close some or all positions to prevent your account from falling into negative balance. As a result, you can never lose more than you deposit.
Margin call should always be avoided at all costs. Traders should always monitor their own margin balance on a regular basis and make stop-loss orders on every open position to limit the risk of loss. There are trading tools that will help you to determine entry points and stop-loss orders.
Also, if you decide to trade on margin account, make sure that you read and understood your broker's policies. For example, during weekends it is possible that the broker would require a higher margin. Let's say that during the week the margin requirement is 1%, then through the weekend it can raise to 2% or even higher. In other words, makes sure to know all the rules before getting into action.
