What is margin call?Margin Call

Risk-free on paper isn't risk-free in practice. Trading costs, funding pressure and execution delays can all spoil an arbitrage.

Margin level tells you how far your account is from the danger line. As soon as positions show an unrealized loss, equity falls and the margin level drops with it.

As the margin level keeps falling, you first get a margin call warning; go lower still and the platform closes your positions automatically.

Drag the leverage and lot size to watch used margin, free margin, the margin call warning and the line that triggers a stop-out.

Futures only require part of the value as margin, but P&L is settled at the settlement price every day at the close. Drop below maintenance margin and you must top up.

Step by step: borrow shares → sell → buy back → return. See how shorting profits from a fall, and why it's riskier.

Borrow from your broker to buy stock: you make more when it rises and lose faster when it falls. See where the price must drop to trigger a margin call.