What triggers a margin call in forex trading?

A margin call is triggered when an account's margin level, equity as a percentage of used margin, falls below the broker's alert threshold, commonly set around 100%.

What is the difference between a margin call and a stop-out?

A margin call is a warning that gives the trader a chance to act, while a stop-out is the automatic closure of positions once margin level falls to the broker's closure threshold, typically between 20% and 50%.

Can a margin call be avoided?

Yes. Keeping sufficient free margin, using stop-loss orders, and avoiding oversized positions relative to account equity are the most effective ways to prevent an account from reaching the margin call threshold.

Does leverage increase the risk of a margin call?

Yes. Higher leverage means a smaller adverse price move can represent a larger percentage loss against the margin committed, which can bring an account closer to its maintenance margin threshold more quickly.