Our margin requirements
Trading on margin can be a useful way of making your capital go further, enabling you to make profits far in excess of traditional trades without having to commit to a larger deposit. But it also comes with the risk of much larger losses, which can even exceed the amount of capital in your account.
To help prevent this from happening, we have a margin policy where we can close your positions automatically if you don’t have the funds to keep them open.
What is a margin call?
Margin call is the term for when the equity on your account – the total capital you have deposited plus or minus any profits or losses – drops below your margin requirement. You can find both figures listed at the top of the IG platform.
At this point, your positions become at risk of being automatically closed in order to reduce the margin requirement on your account.
You can rectify the situation yourself in one of two ways: deposit enough funds to increase your equity above the margin requirement, or close positions to reduce it. Or if you need more advice, call our dedicated support team on 1800 601 734 for information on what to do.
When will my positions get closed?
For retail CFD accounts, if your account equity drops beneath 50% of the total margin required for all of your open CFD positions, we will close your positions as soon as market conditions allow in accordance with the applicable regulations. We will endeavour to apply the same policy to all other account types, however we do not have a regulatory requirement to do so.
For Pro Level 1 and 2 accounts, there are a few other scenarios in which your CFD positions may be automatically closed. However, we can’t always apply this protection and you shouldn’t rely on us doing so.
- If your account equity drops beneath 50% of your margin requirement
- If you remain on margin call constantly for 24 hours
- If you are on margin call during periods of increased volatility, or periods when we anticipate increased volatility
- If you are on margin call going into the weekend. We’ll try to avoid having any accounts on margin call going into the weekend. So if your equity is below 100% of your margin requirement, your positions will be at an increased risk of being closed on a Friday evening
While being on margin call if your equity falls below the margin (or deposit) requirement, the automated close-out system or the dealing desk may, at their discretion, delete working orders, partially close or close some or all trades to reduce the margin requirement until it is fully covered by the account equity.
Our margin requirements are subject to change. If they increase on one or more of your positions then your current equity may not be enough to keep positions open.
Finally, it is important to remember that we could close you out at any time when you are on margin call. It is your responsibility to have enough funds on your account to fully cover the margin requirement of your open positions.
Will I get notified?
We are not under any obligation to keep you informed when you are on a margin call and it is your responsibility to ensure there are enough funds on your account at all times to cover your margin obligations. Any attempt to contact you will be as a courtesy only, and we cannot guarantee that we will contact you. However, if we do so, we may contact you by telephone, post, fax, email or text message.
It is important to note that markets can move fast, which may mean that we are unable to contact you before your positions get closed. If your equity drops from above 100% of margin to below 50% in less than five seconds, for instance, we will not be able to contact you and your positions will be at risk of being closed.