Margin Level is a function to limit your losses so that they don't get deeper, and this is very important in your risk management control role.

Margin Level can also function properly as you STOP LOSS 2.

The Margin Level Percentage formula can be calculated from "Equity" divided by "Used margin" then multiplied by 100% (Equity / Margin x 100%)

A good level margin provided by a brokerage company is a 100% Level Margin, because there are several brokers that are of the type BANDAR that provide margin levels below 100% or even 0%, so that if you lose your money can be used up soon and into the pocket of the city. We recommend that you avoid the type of dealer broker that provides a margin level below 100% and even 0%.

Example of the Role of Margin Level Protection at 100%

Suppose 1: 400 leverage with a capital of 1000 USD, and you are trading with a volume of 3 regular lots in the EUR / USD currency (when running price is at 1.2), the margin used is around 900, and if hit by a stopout at a margin level of 100% then all your open positions will be closed automatically and the funds will only be around 100 USD, while the remaining 900 USD will be returned to you.

Now compare if with no 100% margin level, if you lose, your capital will run out and become 0 without remainder.

So with the 100% margin level it is also a safeguard or substitute for the second stop loss for protection so that your capital is not exhausted, and also encouraged to always use a suitable and healthy lot volume.

In addition, with the 100% level margin feature you can use it as the application of different trading strategies by utilizing the role of full lot, but not too risky, because there is a margin of protection at this level in order to reduce losses. It's like risking $ 100 but it can generate profits that are many times that.

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